High ISO is usually meant to be used when there's not enough light. However, there are cases when you have to take it up from its minimum value even when the sun is bright.
There's nothing tricky about that statement. You will see it's all about physical and optical demands that you need to put a bit of grain in your images in order to get a decently exposed and sharp image.
Sunny Sixteen Rule
Talking about the sun, let's remember that rule which helps you guess the camera settings on a bright day. The rule states that if the sun is strong, you can use aperture of f/16, shutter speed 1/X seconds, where X is your ISO. Let's say you're at ISO 100, which means that the triplet f/16, 1/100, ISO 100 will do the job fairly well. At that aperture, you will have a very deep focus, which means those bokeh-lovers among you won't like it. If we set the aperture at f/5.6, we are three stops brighter, and we need to change the other two values a total of three stops in order to compensate for the brighter image and make it normally exposed again. Let's say we are decreasing the ISO to 50 (which is one stop) and we increase the shutter speed two stops. The final settings will become f/5.6, 1/400 s, ISO 50. Bokeh is not always a cool thing, and f/16 is an aperture you should also consider.
Now imagine you have to photograph a subject in the shade where it's usually at least three or four stops darker. The sunny sixteen rule will be almost the same, but instead of f/16, you have to think of f/5.6 or f/4.0, 1/X sec, ISO X.
When Lenses Limit You
You don't have the freedom to use any shutter speed with any lens, especially when handholding the camera. In general, you have to set your shutter speed at least a 1/L, where L is the current focal length of the lens. For a 200mm, lens you need to have a shutter speed of at least 1/200. Lower shutter speeds can work for you if the camera or the lens have good stabilization and you have steady hands.
Sample Use Case
I photographed that beautiful model in the leading image using a strobe. I set my lights under the shade. I used a 135mm focal length. According to the rule of thumb above I needed about f/4.0, 1/135, ISO 135. My light meter told me to photograph it at f/3.5, 1/80 s, ISO 100, which was fairly close. Having that focal length required my shutter speed to be at least 1/160. At f/3.5, 1/160, ISO 100, the image was one stop darker. As the child was moving around, I set my aperture to f/5.0 in order to have a bit of a deeper focus. This way with a moving model, I might have more images in focus. This made the image an extra stop darker. I compensated with two stops of ISO, setting it to 400. The final settings were f/5.0, 1/160 sec, ISO 400. I used flash and the shutter speed was just fine this way. Here's the order of changes one more time:
- f/3.5, 1/80 sec, ISO 100 - Light meter said so
- f/5.0, 1/80 sec, ISO 100 - For a deeper focus depth, but made image one stop darker
- f/5.0, 1/160 sec, ISO 100 - For a more stable image at a 135 mm focal length, but makes the image one extra stop darker
- f/5.0, 1/160 sec, ISO 400 - Compensating with two stops of ISO
Cases like that are especially true when you photograph landscapes without a tripod or portraits where you want deeper focus. For those who don't think portraits look any good without a blurred background, think of photographing groups of people who are not on the same focal plane (like for a movie poster or a corporate photograph), music band members, fashion, and others. If you happen to use flash, you need to be also aware of your shutter sync speed limitation.
The relation between the lens' focal length and the shutter speed is the most common reason for bumping the ISO up during daytime. This should not be deemed an exception, but a normal case. It's much better to have a grainy, but sharp image rather than a clean and blurred one. Moreover, today's cameras are performing great at high ISO values.