Industrial Special Risks Explained
Industrial Special Risks Insurance (ISR) is an insurance policy designed to protect the physical assets of medium to large organisations which typically may have high asset values, diverse operations and multiple locations.
ISR is essentially the most flexible property policy available.
The policy covers all accidental loss or damage by any cause unless specifically excluded – there are of course, some exclusions – but it provides a far broader cover than a policy which covers for only those events defined in the policy, such as a traditional fire policy.
If your organisation has assumed responsibility for buildings, stock, machinery or other physical assets, Industrial Special Risks Insurance covers the cost to reinstatement or replacement in the event of damage.
ISR includes Business Interruption Insurance
The Industrial Special Risks or ISR policy also incorporates business interruption insurance which protects the revenue loss, ongoing expenses and additional costs following a loss under the material damage policy.
Statistically, the majority of businesses, who sustain a large material damage loss, do not survive because of the lack of business interruption cover.
The most significant benefit is the protection of your balance sheet following an insured loss. It can protect your net profit and standing charges, wages and specified additional costs. An important consideration is the assessment of the time required for the business to recover its pre accident trading level as this will determine the indemnity period (the period during which the insurer is responsible for payment of costs and lost revenue).
There are also many negotiable extensions of ISR cover available to meet your organisation’s specific risk profile such as, but not limited to:
- Claims preparation costs;
- Damage to customers or suppliers premises which affect your revenue; and
- Loss due to accidental failure of public authorities’ electricity, gas or water supply.
An ISR policy can be complex with the range of additional cover available such as burglary, machinery breakdown, fraud and marine risks.
Austral provides the experience you need to advise you on a cover specific to your business exposures. A claim under an ISR policy can be significant so it is vital that your property assets and revenues are properly specified and covered.