Property Damage
Insurance

The property damage section of an Industrial Special Risks policy is the foundation of your commercial property protection. It covers physical loss of or damage to your insured property - including buildings, structures, fixtures, fittings, plant, machinery, stock and contents - caused by any event that is not specifically excluded under the policy.

Because ISR operates on an "all risks" basis, it covers accidental physical loss or damage that is not otherwise excluded, which is generally broader than a named-perils policy. Events such as fire, lightning, explosion, storm, tempest, impact by vehicles or aircraft, malicious damage and accidental damage are commonly covered, subject to the exclusions, sub-limits, conditions and the schedule. Some perils, such as flood, are often optional, sub-limited or excluded, so check your schedule for what applies.

Property damage cover is essential for any Australian business that owns or leases commercial premises, holds significant stock or relies on plant and equipment to operate. Without adequate cover, a single event such as a warehouse fire or severe storm could result in catastrophic financial loss.

While ISR property damage cover is broad, certain events and circumstances are typically excluded. Common exclusions include:

• Wear and tear, gradual deterioration, rust, corrosion and inherent defect
• Damage caused by faulty workmanship or design (though resulting damage may be covered)
• War, terrorism (terrorism cover may be available through the Australian Reinsurance Pool Corporation)
• Contamination by radioactive material or nuclear hazard
• Damage to property undergoing testing, commissioning or being worked upon
• Earth movement, subsidence or landslip (cover may be available by negotiation)
• Mechanical or electrical breakdown (covered under the machinery breakdown section)
• Consequential loss or loss of income (covered under business interruption section)

Exclusions vary between insurers and policies. Your insurance broker can help you understand the specific exclusions that apply to your ISR policy and negotiate extensions where required.