Unauthorized Disclosure of Confidential Info. Insruance

Overview — Intellectual Property Insurance Services Corporation

Intellectual Property Insurance Services Corporation offers an Unauthorized Disclosure of Confidential Information insurance program that provides litigation expense coverage to defend insureds against allegations of unauthorized disclosure of entrusted confidential information or trade secrets belonging to a third party. Policy limits are $5MM/$MM. The program also includes provisions that, in certain circumstances, may extend coverage for incidents involving a rogue employee.

Ideal Accounts and Appetite

This program is designed for businesses that handle sensitive third-party information and face litigation risk from alleged disclosure or misuse of that information. Typical target classes include:

• Technology and software vendors, SaaS providers, and development shops
• Consultants, engineering firms, and professional services firms with client access to confidential data
• Contract manufacturers, R&D facilities and labs that handle proprietary processes or formulas
• Staffing and recruiting firms that process candidate and client information
• Marketing, advertising, and creative agencies that work with client trade secrets or confidential strategies

Accounts with documented privacy and confidentiality controls, formal NDAs, employee training, and reasonable access controls are preferred. The program typically does not target accounts with known, unresolved misappropriation claims or ongoing litigation related to the same facts at the time of submission.

Coverage Highlights and Advantages

• Defense expense coverage for allegations of unauthorized disclosure or misuse of a third party’s confidential information or trade secrets.
• Policy limits are $5MM/$MM as noted; terms and sublimits depend on underwriting and carrier participation.
• Provisions that may provide coverage for incidents involving a rogue employee are available on certain placements (subject to underwriting review and policy wording).
• Available through an MGA with access to various carrier markets—useful when you need flexible capacity or tailored wording for specialty exposures.

Underwriting Notes and Minimum Premiums

Underwriters will review the nature of the confidential information handled, contractual obligations to third parties, existing confidentiality agreements, internal controls, employee access policies, background screening practices, and prior claims history. Known or pending claims, intentional criminal acts, or widespread uncontrolled access to trade secrets are common declinations or may lead to exclusions.

Minimum premium: varies. Exact minimums depend on the carrier, state of placement, and account-specific exposure. Provide complete loss history and details on controls when submitting to help secure the most competitive terms.

Territories and Availability

This program is available in most states. Territories include: AK, AL, AR, AZ, CA, CO, CT, DE, FL, GA, HI, IA, ID, IL, IN, KS, KY, LA, MA, MD, ME, MI, MN, MO, MS, MT, NC, ND, NE, NH, NJ, NM, NV, NY, OH, OK, OR, PA, RI, SC, SD, TN, TX, UT, VA, VT, WA, WI, WV, WY, and DC. Availability and admitted/non-admitted placement options will vary by carrier and state.

Why Work With Intellectual Property Insurance Services Corporation

• Niche focus on intellectual property and confidential information exposures gives you access to specialized underwriting appetite and tailored wording.
• MGA access to multiple carriers increases the chances of placing difficult or higher-limit accounts.
• Practical submission guidance: underwriters typically want to see confidentiality agreements, employee policies, and loss history up front to evaluate risk efficiently.

Example Scenarios

• You have a mid-sized software vendor whose former engineer is alleged to have taken client source code to a competitor. The insured needs defense costs to respond to a demand letter and potential litigation.
• A contract manufacturer is accused of using a customer’s proprietary formula to produce a competing product. The account has written NDAs and documented access controls—this program can address the defense expense exposure.

Frequently Asked Questions

Need help placing an account? Connect with a market specialist.