Industrial All Risk Insurance (often abbreviated as IAR) is a comprehensive type of insurance designed to protect industrial assets against a wide range of unforeseen events. Let’s dive into the details:

What It Covers:
Broad Coverage: An IAR policy provides coverage for practically all risks and perils that a large industry may encounter throughout its operations.
Fixed Assets: It includes protection for fixed assets such as buildings, machinery, furniture, fixtures, fittings, and electrical systems.
Stocks: Stock is covered on a market value basis.
Transit Risks: The policy also covers equipment and machinery sent for maintenance outside the premises for a specified period (usually 60 days). Additionally, transit risks within an industry’s compound are covered.

Salient Features:
Comprehensive and Practical: The IAR policy is comprehensive, practical, and cost-effective. Unlike named peril policies, it covers a wide range of dangers.
Burglary Coverage: It includes coverage for burglary losses (both material damage and business interruption).
Business Interruption (BI): BI due to fire and other hazards is compulsory. Optional BI coverage can be added for machinery failure, boiler explosion, or electronic equipment failure.
No Depreciation for Limited Life Equipment: For limited-life equipment, no depreciation is subtracted from the material damage loss (whether total or partial).

Benefits:
Complete Protection: Compared to a standard Fire Insurance Policy, IAR provides broader coverage. It protects against various risks beyond just fire.
Machinery Loss of Profits: Insurers can use the IAR Policy to secure stronger coverage against losses caused by machinery damage.
Business Interruption Compensation: The policy compensates for losses incurred when commercial operations are disrupted or halted.

Eligibility Criteria:
An Industrial All Risk Policy is applicable to all industrial risks (except those ratable under the Petrochemical Tariff)