Industrial Special Risks (ISR) policies are designed for organisations that operate across multiple locations or have high-value property, equipment, and stock, making it a cornerstone of risk management for large enterprises.
Unlike standard property insurance, ISR policies offer a flexible, all-in-one solution that covers physical loss or damage to insured property and can include consequential financial impacts. This means businesses are protected not only against direct damage but also against the ripple effects that disrupt operations.
In Australia, ISR insurance has become increasingly important due to rising exposure to natural disasters and complex supply chains. Bushfires, floods, and severe storms can cause catastrophic damage to facilities and infrastructure, while global logistics challenges amplify the risk of prolonged downtime. Without ISR coverage, companies may face crippling repair costs and operational delays that threaten long-term viability.
Typical ISR policies include:
- Property Damage: Covers physical loss or damage to buildings, plant, machinery, and stock.
- Business Interruption: Protects against loss of gross profit or revenue during recovery periods.
- Additional Costs: Includes expenses incurred to minimise disruption, such as temporary relocation or expedited repairs.
- Optional Extensions: Can cover theft, accidental damage, and machinery breakdown, tailored to business needs.
The complexity of ISR policies means wording and limits matter. Recent events, such as extreme weather and global supply chain shocks, have highlighted the need for customised coverage and clear terms. Insurers and brokers now focus on transparency and proactive risk assessment to ensure businesses understand what is included—and what is excluded.
For Australian companies, ISR insurance is more than a safety net; it is a strategic investment. It supports continuity planning, protects stakeholder confidence, and enables rapid recovery after major incidents. With insurers leveraging advanced tools like satellite imagery and predictive analytics, ISR coverage is evolving to meet modern challenges.
In an unpredictable environment, ISR insurance helps businesses withstand large-scale risks, making it essential for resilience and long-term success.