Open-source software insurance

A “consulting outfit called Open Source Risk Management has partnered with Lloyds of London underwriter Kiln and broker Miller Insurance Services to offer insurance against open-source liability” — that is to say, the risk of getting sued for use or development of open-source software. OSRM chairman Daniel Egger says he was inspired to start the outfit by SCO Holdings’s suits against IBM and other defendants over Unix-derived code: “”What was striking was the amount of uncertainty and fear caused by a relatively weak claim,” Egger said. “Just because they cried wolf doesn’t mean there aren’t wolves out there.” (Marie-Anne Hogarth, “Open-Source Software: Open to Liability”, The Recorder/, Nov. 15). See Nov. 13, 2004 and Nov. 6, 2003.


  • Software is a capital intensive business – all the money is invested before collecting the first cent. An intellectual property dispute that keeps a product off the market could quickly become a financial disaster.

  • You know, this is a lot less paranoid than you’d think at first glance.

    If I wanted to make money litigating bogus software IP, Open Source is a great way to start. Bogus or overly broad patents require, y’know, a patent, standard theft of code suits need some plausible scenario where they’d be able to access your code, but this…all you need is to show that someone accessed your site once, and there you go.

    Easy to fake, too. And it’s not like most companies keep extensive records of every site visited for years, that’d require huge amounts of information.

  • Open source insurance – it’s time has come

    If you can mitigate your business risk, and the price of that mitigation has a positive NPV given your cost of capital, you generally take it. I’ve therefore always been a believer in insurance. I consider it (in several forms)…