What is Industrial Special Risks Insurance?*
Industrial Special Risks insurance is a broad business insurance for medium and large businesses with insured values of $2 million and above.
Industrial special risks (ISR) insurance provides protection for a range of risks NOT specifically excluded in the policy.
ISR policies are typically divided into two sections: Property Damage and Consequential Loss.
Property Damage in an ISR policy may cover:*
- Reinstatement or replacement of the assets – building, stock, contents, machinery, theft, money , glass
- Architects, engineers, surveyors and other fees payable to facilitate reinstatement;
- Fees necessary for local authorities for rebuilding approvals and costs necessary to comply with statutory authorities – eg. heritage;
- Customs fees, excise and other duties necessary;
- Temporary protection of property awaiting its repair or replacement;
- Replacement of locks, alarms, keys and combinations when damaged or stolen;
- Removal of debris, reinforce damaged property, interim repairs;
- Repair or replacement of directors and staff valuables left on the premises;
- Costs in quashing a fire and/or restocking fire protection equipment;
Consequential Loss in an ISR policy may cover:*
- A decline in turnover or revenue
- Increased costs to limit any decline in turnover or revenue ( increased cost of working). This may include any valid expense incurred to get the business operational again such as the use of back up facilities or sites, overtime payments to employees, importing equivalent products etc.
- Payments to professionals and other expenses to prepare a claim;
- Payroll costs
Industrial Special Risks policies can be complex so may require a full needs analysis to understand the risks faced and develop an appropriate risk protection program for your business.
It takes a significant amount of experience to advise on a suitable industrial risks policy, brief in your business risks in detail ,and negotiate competitive terms with insurance companies and underwriters.
Depending on your industry the "risk appetite" of insurance companies and underwriters vary considerably. A high calibre broker with extensive experience working on ISR policies can make a significant difference in the outcome for you at both policy inception and if you ever need to claim. As claims can be significant with industrial special risks policies it is vital to have your business risks suitably specified and covered.
Business insurance policies normally required by medium and large businesses in addition to industrial special risks insurance include public liability, motor fleet insurance, cargo insurance, cyber insurance and more depending on the business.
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*Important: Cover may be available subject to meeting insurers underwriting criteria. Some of the covers listed may or may not be available or may have limitations or exclusions. Cover inclusions vary significantly from insurer to insurer. DO NOT rely upon the above. Check your policy schedule carefully for inclusions and exclusions and limitations. Talk to a SMART insurance broker on 1300 542 573 for more information.
What is the correct "Situation Address" to list on my business policy.?
The Situation Address must be the address of either the physical risk being covered (like a property) or, in the case of Liability policies, the physical address for the normal place (or places) of business.
If you have multiple business locations, e.g., a number of branches, shops, factories or depots, then ALL location addresses must be shown on the schedule and advised to the insurers. And the multiple location addresses then needs to be kept up to date with the insurers at all times, in the event of any changes.
Insurers will not accept a Post Office box as a "normal place of business", because you cannot do business from a PO Box.
A PO Box is fine for a mailing address, but cannot be used as the address of the "Situation" on any policy.
For example, Public Liability policies usually operate "at and from" an address, which should be the normal place of business for a business policy.
If the business was run from home, for example, then the home address would be shown as the normal place of business. The "at and from" nature of the cover would then cover any transitory business conducted away from the home address (or away from a real business address, as the case may be).
If the business was run from home but was selling through stands or kiosks at markets or shopping centres then that would have to be disclosed to the insurer, as it affects the risk.