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Insulated implies that the rail is cut and does not connect from one end to the other.

Not bonded together outside rail--aka removed or never there bus bar just doesn't short the 2 outer rails.

So yes, any piece of track that has no bus bar or has the bus bar removed- can extend an insulated rail section.

By that same nature, they can be used anywhere on the layout. They connect end to end and hopefully other adjoining rail sections bond (via their bus bars) the 2 outside rails for good solid power all around the layout.

Specifically, there are 3 known fastback sections that create some form of insulated or break electrically between sections.

The 5 inch cut outer rail sections included with the level grade crossings with gates or just lights, also the anti the accessory activator track packs. Again, these specially have one outside rail cut, and no joining bus bar.

The short 1 3/8 inch pieces (often included with switches) or separate sale have a cut center rail and are used creating isolated sidings or block sections between 2 loops of track. These have tab terminals and a jumper wire supplied.

Last, there is a special block section track.

This has cuts in all 3 rails, and 3 jumpers underneath to connect one or more of the cut rail insulated rails. It can be used for either blocking power, or making a sensing section, or even both in an extremely specialized case.

Technically, you can even use what you might consider an insulated section of track with a cut user rail- but if the track sections on either side have bus bars- they effectively negate the cut and it's just another 5 inch track section.

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