Industrial special risks (ISR) insurance is one of the most comprehensive and flexible forms of property insurance available to medium to large organisations. Unlike standard business insurance, ISR policies are designed to protect physical assets, manage exposure to operational risks, and provide wide-ranging cover for material damage and consequential loss.
This article is worth reading because it explains what ISR insurance is, why it matters, and how business owners—especially those with high-value assets or multiple premises—can safeguard their operations with the right cover. Whether you’re an electrical contractor, manufacturer, or commercial property owner with insured property, understanding ISR can mean the difference between quick recovery and devastating financial impact after a major incident.
What are Industrial Special Risks and Why Do They Matter?
Industrial special risks refer to insurance designed to provide cover for property damage, business interruption, and other losses affecting medium to larger organisations. Unlike standard property insurance, ISR policies provide comprehensive coverage, insuring a wide range of perils, including fire, storm, accidental damage, and more, unless specifically excluded.
ISR insurance is designed to protect business or commercial property owners with insured property by covering not just the buildings and materials, but also plants and machinery, high-value assets, and business assets. This type of insurance provides resilience in the face of complex risk exposures that standard policies may not address.
For business or commercial property owners, ISR is particularly valuable because it provides cover across multiple locations. Whether your organisation operates in one premise or has properties spread across states and territories, ISR can deliver one streamlined policy solution tailored to your business needs.
How Does an Industrial Special Risk Insurance Policy Work?
An ISR policy is sometimes referred to as an “all risks” insurance policy because it covers assets by any cause not excluded. This means the policy provides cover for property damage, loss of profits, or increased expenses caused by contingent damage to property at the premises of suppliers, customers and utilities.
The insurance policy provides a safety net for insured businesses by including property at the premises, materials and machinery, and business property. It is particularly important for high-value businesses where significant loss or damage could result in devastating financial consequences.
ISR insurance provides flexibility. The policy wording is adaptable, which means business owners can work with their insurer or insurance broker to customise the insurance solution. For example, ISR may include business interruption cover, machinery breakdown protection, or other additional property policies.
The Role of Brokers in Industrial Special Risk Insurance
Finding an insurance solution for complex risk exposures is rarely straightforward. An insurance broker plays a critical role in helping business or commercial property owners secure ISR coverage that matches their unique business needs.
A broker understands the insurer’s policy terms, exclusions, and exposure considerations. They work on behalf of the insured, ensuring that the ISR policy is suitable for the organisation, provides comprehensive cover, and includes the right level of cover for physical assets, business property, and plant and machinery.
One of our insurance specialists at HMDI can assist you in navigating policy terms, identifying exclusions, and ensuring your ISR insurance is designed to protect your business assets effectively. When working with a broker, you also gain access to competitive market insights and tailored advice that goes beyond simply comparing policy costs.
Key Features of an ISR Policy
An ISR policy is designed to protect business property and operations from significant loss or damage. Here are some of its defining features:
- Material Damage Cover: Provides cover for property damage to buildings, plant and machinery, and commercial property. This includes accidental damage or peril-related events.
- Business Interruption: ISR policies include business interruption cover to protect against loss of profits and consequential loss following property damage. This ensures that a business can continue operating or recover quickly after an incident.
- Comprehensive Coverage: Unlike property policies such as machinery breakdown insurance, ISR offers broad protection against exposure to multiple risks.
- Flexibility: The policy provides cover across multiple locations and can be tailored to medium- to large-sized businesses with high-value assets.
The policy provides comprehensive cover, but it’s also important to check with your insurance broker about the policy wording, exclusions, and insurer’s obligations.
Why Medium to Larger Organisations Should Consider ISR Insurance
For medium to larger organisations, the financial impact of a significant loss or damage event can be catastrophic. ISR insurance is designed to provide comprehensive coverage for high-value assets, operational risks, and business interruption.
If you’re a commercial property owner with insured property, ISR provides cover for property damage and loss of profits. It also protects against expenses caused by contingent damage, such as issues with suppliers or customers that affect your operations.
Businesses that operate across multiple locations, rely on plant and machinery, or manage high-value assets will find ISR particularly effective. For business owners in industries with complex risk exposures, ISR insurance provides the right cover to ensure long-term resilience.
Understanding Exclusions and Policy Terms
Like any insurance policy, ISR has exclusions. While ISR is designed to protect against many perils, certain exposures may not be included. Typical exclusions could involve specific liability insurance risks, motor insurance, or high-risk exposures not listed in the policy terms.
It’s essential to read the policy wording carefully and understand how exclusions might affect your business assets. A broker can guide you through these complexities and help you add additional property policies, such as machinery breakdown or public liability coverage, where necessary.
Understanding exclusions ensures your ISR policy is suitable for your business activities and doesn’t leave you vulnerable. Always check with your insurance adviser to make sure your policy provides cover for property damage, consequential loss, and operational risks specific to your organisation.
ISR Insurance and Risk Management
ISR insurance is more than just a financial product; it’s a cornerstone of effective risk management. By protecting high-value assets, including property, machinery, and business property, ISR reduces exposure to financial loss from perils, accidents, or business interruption.
Risk insurance is designed to complement other policies such as liability insurance or motor insurance, ensuring your business has a comprehensive cover strategy. Business owners should view ISR as a policy designed to protect their investments, secure business continuity, and reduce operational risks.
ISR is a vital insurance solution that provides cover for property damage or loss of profits. Whether you’re a medium- to large business or a commercial property owner, ISR offers the flexibility and comprehensive coverage needed to protect your business effectively.
Conclusion: Protect Your Business with ISR Insurance
Industrial special risks insurance provides one of the most comprehensive cover options for medium to larger organisations, business owners, and commercial property operators. It offers flexibility, includes business interruption, and is designed to protect physical assets and high-value operations across multiple locations.
The most important things to remember are:
- ISR provides cover for property damage, business interruption, and high-value assets.
- It is a policy designed for medium to larger organisations, especially those with complex risk exposures.
- Exclusions matter—always review policy wording and check with your insurance broker to ensure your insurance provides the right cover for your business.
- An insurance broker is invaluable in tailoring an ISR policy to suit your unique needs and exposure.
If you’re ready to protect your business and explore how industrial special risk insurance can provide comprehensive coverage, contact HMDI today. Our trusted insurance brokers can help you get a quote, review your insurance requirements, and ensure your business has the right level of cover.
