My RAID drive failed, wiping out 4TB of data—including my entire purchased Spitfire Audio library (about $10,000 in licenses) and five years of custom field recordings I created myself. My insurance covered the cost of a replacement 4TB hard drive—about $150—but refused to pay for the software licenses or the value of my original recordings.
Key Takeaways
- “Electronic Data” Exclusion: Standard property policies cover tangible property (the disk). They exclude intangible property (the data).
- Software Recovery: If you have valid licenses, you can re-download purchased libraries (Spitfire/Native Instruments). Insurance might pay for the “Labor Cost” of a tech to reinstall them if you have a “Data Recovery” rider.
- Custom Sounds are “Art”: Your field recordings are like a manuscript. Unless you have a “Valuable Papers / Records” endorsement with an Agreed Value on the intellectual property, they are considered to have $0 commercial value until sold.
- Data Recovery Services: Some policies will pay for DriveSavers (expensive forensic recovery) to get the data back. This is the coverage you want.
The “Why” (The Trap)
The trap is “Tangibility.”
Insurance puts you back where you were financially.
For purchased software, you can re-download it for free. Your financial loss is $0 (just time).
For custom sounds, unless you can prove you sell them for $X/year, the insurer sees them as a hobby project with no intrinsic market value.
The Investigation (My Analysis of Digital Assets)
I checked how to insure data.
MusicPro / Clarion
- The Policy: They cover “software” often up to a limit, but usually focusing on the replacement cost of the media.
- The Rider: You can buy “Electronic Data Processing” (EDP) coverage. This pays for the cost to reconstruct the data (hiring a pianist to re-record the samples), but it’s expensive and requires proof.
DriveSavers Partner Programs
- The Best Bet: Many PPA (Professional Photographers) and Music organizations have discounts with DriveSavers.
- The Coverage: Specific “Data Recovery Insurance” exists as a cyber product.
[IMAGE: Photo of a hard drive platter with a “Click of Death” scratch visible]
Comparison Table
| Item | Standard Policy | EDP / Data Rider |
| Hard Drive Hardware | Covered ($150) | Covered |
| Purchased Software | $0 (Re-download) | $0 |
| Forensic Recovery Cost | $0 | Covered (up to limit) |
| Value of Custom Sounds | $0 | Difficult to prove |
Step-by-Step Action Plan
- Back. Up. Everything. The only insurance for data is redundancy. Cloud (Backblaze) + Local (Time Machine) + Offsite (Drive at Mom’s house).
- Check “Data Recovery” Limit: Look at your policy. Is there $5,000 for data recovery? If not, add it.
- Keep Serial Numbers: If you lose the licenses/dongles (iLok), insurance will pay to replace the licenses if you can’t recover the account.
- Value Your IP: If your sample library is your livelihood, talk to a commercial broker about “Intellectual Property” insurance.
FAQ
Does insurance cover my iLok?
Yes. If the dongle is stolen, they pay for the dongle AND the Zero Downtime coverage fees to recover the licenses.
What if I get a virus (Ransomware)?
That is Cyber Insurance. Not Property Insurance.
Is cloud storage fees covered?
No. Utility expense.