Is an ISR Policy more expensive than a Defined Perils policy?
Generally yes, because the cover under an ISR policy is substantially wider than a Defined Events cover as mentioned above. However, not all commercial properties need the wider cover afforded under an ISR policy. Indeed, smaller commercial properties with values of say, less than $2.00M can usually obtain sufficient insurance cover at a more affordable cost under a defined perils policy which can usually be purchased at a cheaper premium. But, it is important to ensure that a policy’s terms of cover are not overly restricted – as a general rule, the more restrictive cover, the cheaper the premium; and that can be a trap for the inexperienced. Determining if an ISR policy is recommended will largely depend on the type of commercial activity carried on at the property. For instance; a saw-mill’s activities would likely include a lot of things ordinarily not covered and otherwise excluded under a ‘defined perils’ policy; whereas, a commercial property used as a warehouse or storage facil
