Property insurance designed around the real asset exposure

Commercial property insurance can extend well beyond the building itself. Depending on the risk, a program may need to consider buildings, fitout, plant and machinery, stock, tenant improvements, landlord fixtures, electronic equipment, machinery breakdown and business interruption. For larger or more complex risks, Industrial Special Risks (ISR) wording may be considered where appropriate.

Property types we work with

• Industrial and manufacturing sites
• Shopping centres and retail property portfolios
• Commercial offices and mixed-use assets
• Warehouses and distribution facilities
• Cold storage, food processing and refrigeration risks
• Multi-location owner-occupied businesses
• Property owners with multiple legal entities or titles
• Higher-hazard or harder-to-place property risks

Business interruption

A major property loss can affect revenue long after physical repairs begin. Business interruption insurance may cover insured loss of gross profit, gross revenue, rent or other insured financial measures, together with additional costs of working, subject to the selected basis of settlement and policy terms.

Important considerations can include the indemnity period, declared values, uninsured working expenses, trends and variations, claims preparation costs, prevention of access, utilities and dependency exposures.

Property valuation and declared values

Underinsurance can materially affect claim outcomes. We encourage clients to review replacement values, stock, machinery, fitout and business interruption declarations carefully and to consider professional valuations where appropriate. Our role is to explain the insurance implications of declared values and policy conditions rather than provide valuation advice.

Higher-hazard construction materials

Insurers commonly focus on the construction and insulation used at a site. Expanded polystyrene (EPS), polyurethane or polyisocyanurate (PIR) insulated panels, aluminium composite panels and other combustible materials can materially affect insurer appetite, deductibles and risk-management requirements.

Read more about EPS & ACP insurance →

Machinery and equipment

Manufacturing, refrigeration and automated facilities may require machinery breakdown or equipment breakdown cover in addition to standard property insurance. Depending on the policy, cover can extend to sudden and unforeseen mechanical or electrical breakdown and associated business interruption, subject to terms and exclusions.

Catastrophe and natural peril exposure

Flood, storm, cyclone, bushfire, hail and earthquake exposures can significantly affect pricing and capacity. Insurers may apply location-specific deductibles, sublimits or exclusions. For larger portfolios, concentration of values across catastrophe zones is also important.

Information insurers commonly require

• Addresses and occupancy of each location
• Building, contents, stock and machinery values
• Construction materials and year built
• Fire protection, sprinklers and alarm systems
• Business interruption declarations and indemnity period
• Claims history
• Flood, bushfire and other natural-hazard information
• Tenant details for investment properties
• Risk surveys or engineering reports where available

Industrial Special Risks (ISR)

ISR policies are commonly used for larger or more complex commercial property risks. They can provide broad material damage and business interruption protection, but the exact scope depends on the wording, schedule, endorsements and declared values. Sub-limits and exclusions can differ materially between insurers.

How Mercantile approaches complex property placements

We focus on presenting the risk clearly, including construction, fire protection, occupancy, values, loss history and risk improvements. For larger portfolios you should also consider how locations aggregate, how deductibles apply and whether business interruption exposures are adequately reflected across the program.

All cover is subject to the insurer’s policy wording, schedule, limits, deductibles, conditions and exclusions.