The tragic and deadly fires in Melbourne’s Docklands Lacrosse apartments, London’s Grenfel Tower, Dubai’s The Address Downtown Dubai, and Dubai’s Sulafa Tower have made it clear that using cheap – and flammable – aluminium cladding is an inexcusable insurance risk. Following the Docklands fire, Melbourne authorities audited 170 buildings and found 51% of them to be non-compliant, and NSW authorities have warned that up to 2,500 NSW buildings could contain combustible cladding.
Some builders have argued that they can mitigate the potentially catastrophic risk of using aluminium composite panels (ACP) by adding more sprinklers. This simply isn’t enough. The Chinese-manufactured cladding is highly combustible, not tested to Australian standards, has been shown to fuel fires, and its use is increasingly deemed as irresponsible.
So why are they still used? ACP panels are cheap, lightweight, sleek, and modern in appearance. Two outer aluminium skins encase an inner insulating core – and herein lies the problem. The core material most commonly used is highly combustible polyethylene.
The good news is that fire-rated ACP panels exist with a mineral core (asbesto) – but in the interest of cost savings, many builders have opted for the cheap non-fire-rated panels.
The bad news is that it’s hard to tell the difference between the panels, unless samples are tested. And, while asbestos is fire-resistant and is fully encased within the panels, it poses other health hazards should it become exposed.
Underwriters are increasingly asking about the specific types of ACP cladding used on buildings. However, it can’t be left up to the owners to know the composition of the building’s cladding. Many simply say, “metal”; and even if they do say “aluminium,” it may fall on the broker to identify the type of metal, as well as the type of insulating core. If brand names and specifications aren’t available, a risk engineer will need to test panel samples.
A builder and/or a building’s owner (or owner corporation) has the duty and responsibility to inform not only its residents but their insurers that the building is constructed of ACP that may or may not be compliant with combustibility requirements for high-rise buildings.
“The external cladding material on this building did not to the degree necessary avoid the spread of fire as required by the Building Code of Australia,” MFB Chief Officer Peter Rau said. “Simultaneous internal fire ignition events over multiple floors are simply an unacceptable fire safety solution for a residential highrise building, or any other occupiable building for that matter.
At the time the Docklands Lacrosse building was commissioned, NO ACP products had passed combustibility tests: only Australian standard tests for ignitability, heat and smoke, and flame spread – but not combustibility. Since the contract stipulated use of ACP and this was documented on both planning and building permits, some of the blame also lies with the authorities who approved these permits.
Unfortunately, a recent survey by the Australian Industry Group found that products that do not meet Australian safety standards are often offered to builders – resulting in up to 50% non-compliance.
The facts you need to know about ACP cladding with a polyethylene (PE) core:
- The cladding will not spontaneously combust – it requires an independent ignition source in order to catch fire.
- Once it’s on fire, the cladding fuels the spread of fire, particularly in high-rise buildings.
- It is not banned, because it is deemed safe in some applications.
- Building owners are being notified as it is determined that their buildings contain composite PE cladding.
- There is currently no legal action to require removal of existing PE panels.
- The government is considering a ban on PE panels for high-rise applications.
What does this mean in terms of insurance? Significantly higher premiums and potentially lower payouts on a policy.