Recent apartment and factory fires around the world, resulting in millions of dollars’ worth of property loss and in some cases, the loss of life, have resulted in a worldwide debate over the safety of insulated panelling.

Insulated panelling is used extensively throughout New Zealand, especially to support key industries like dairy, meat and seafood processors, wineries, cool stores and other food-related businesses.

One of the most common materials used in the core of the panelling is expanded polystyrene (EPS), which is highly combustible.

One of Australia’s largest meat processors, Thomas Foods’ abattoir caught fire last year, resulting in tens of millions of dollars’ worth of damage.

Fire investigators determined the blaze was started accidentally by a worker who was welding an offal bin. It unfortunately went through a wall with EPS insulated panelling and spread through the premises extremely quickly, putting factory workers lives at risk. Luckily no one was hurt, but the company was left with a hefty damage bill. 

Bryan Tedford, NZI’s national business continuity and asset protection portfolio manager, says once a fire begins, EPS panels melt quickly and release vapours, which can increase the spread of a fire throughout an exposed building.

“The fire will spread throughout the building in just seconds, which not only results in major property loss, but also puts people’s lives at risk.”

Tedford says it’s important all businesses using insulated panelling are informed on how to manage exposure.

“Wherever possible, our advice to those planning to construct with EPS, is to substitute for a non-combustible panel like PIR.

“For insulated panelling sites, risk management is a priority, so businesses should also be safeguarding themselves with an approved sprinkler system, regular preventative electrical inspections and implement formal hot works procedures.”

Tedford says NZI has reviewed the way it insures properties with insulated panelling and this is intended to encourage clients to use safer alternatives to EPS.

“NZI clients who use preferable panels like PIR and/or safeguard their premises with approved risk management requirements, will have higher limits available to them for material damage and business interruption (combined limited) insurance than those premises that don’t.” 

He says it’s a common-sense approach and one that fits with parent-company IAG’s purpose to make the world a safer place.

“We’re realigning our risk appetite to ensure we can continue to offer cover for our clients and keep New Zealand safe.”

March 2019

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