Flammable composite cladding panels – is your building covered?

Are you covered if your building uses flammable composite cladding panels? How does the  fall-out from the Grenfell Tower building fire in the UK affect you?

Australian insurers are backing a national survey of buildings using flammable cladding in the wake of the devastating blaze that killed at least 58 people in London’s Grenfell Tower. Think it won’t happen in Australia? Think again!!! In 2014 the Lacrosse Apartments in Melbourne’s Docklands suffered significant damage and threatened the lives of occupants from a similar fire.

NIBA, national insurance brokers association which represents around 360 member firms and more than 2000 individual Qualified Practising Insurance Brokers (QPIBs) throughout Australia. In total NIBA represents an estimated 90% of all insurance brokers in Australia. Has previously reported on policy issues with cladding in February last year, noting that following the Docklands apartment building fire, the Victorian Building Authority was prompted to audit 170 buildings as part of their investigation. The audit found 51 per cent of the buildings were non-compliant.


So what does this mean for Strata Unit policy holders?

Strata Unit policies protect the building from unforeseen loss or damage but exclusions can apply when there is a known risk, or construction is in breach of safety standards.

Victorian Planning Minister Richard Wynne moved last week to reassure residents that Australia’s strong building codes mean a similar tragedy would not occur here. But experts disagree, saying the prevalence of flammable cladding here remains a serious threat to life.*

There are links being made between the fire in London and a fire in Lacrosse Building Fire, Melbourne (2014) which allegedly used some of the same cladding materials.**

The cladding in question are aluminium composite panels that have a polyethylene or plastic core and an aluminium coating. It is a cheap building material widely used worldwide to clad high-rise apartment buildings. These panels are lightweight, easy to install, and provide an attractive metallic building finish. The panels typically range from 4 to 6 mm in thickness, made up of two outer aluminium skins, separated by an inner insulating core. Unfortunately, the most common core material used in these panels is highly combustible polyethylene (PE) plastic! There are also fire-rated ACP cladding panels which have a mineral core, but there has been a lot of imported, lower-cost, non-fire-rated material used in the industry. It’s hard to tell the difference between the panels unless samples are taken and tested. If there is information on the exact product used this is also very helpful.

aluminium panels and insurance implications

Australia’s national science agency, the CSIRO, conducted tests on the Lacrosse building cladding in April 2015 and found it was combustible and did not meet building codes.***


What you need to know:

  1. There is a chance that some of these composite panels have been used in high-rise apartment buildings in Australia. The name of the building material used on the Lacrosse apartments was called Alucobest but there are other names.
  2. These panels pose a significant fire risk and should be removed
  3. You are obliged to notify your insurer if you discover the use of these panels on your building
  4. If your body corporate knows these panels have been used in your building and fails to act, your insurer could refuse any damage claims resulting from fire.


What to do next:

  1. If you have doubts or concerns that the safety of the occupants in your building might be compromised by the use of flammable cladding, engage a building professional to give you advice
  2. Report findings to the broker and make a plan to remove the safety hazard or mitigate the risk


It’s important to remember the safety and wellbeing of building occupants is paramount, regardless of the insurance implications.


We must ensure that this type of tragedy does not happen again and we can prevent it by being diligent.


As your Broker we will ensure that we know what kind of metal is used and if aluminium panels – we will ask for the brand and clarify specifications. We will then refer this to our panel of insurers who have specialist risk engineers available to give advice and guidance.



Image – http://thenewdaily.com.au/news/world/2017/06/19/london-fire-death-toll-79/