Blog - Commercial

04 October 2019

Potential Fire Risk with External Cladding

In 2014 a fire in Melbourne took less than 11 minutes to race up 15 levels causing in excess of $6m of damage. In the post-incident report, the Metropolitan Fire Brigade identified external cladding as largest contributor for the rapid spread of the fire. Following this event, the Victorian Building Authority (VBA) conducted an audit of 170 buildings and discovered 51% had some level of non-compliance with Building Code of Australia specifications.

It was concluded that the presence of combustible cladding on buildings considerably increases the riskof first party property loss and third party damage or injury in the event of a fire. This is particularly concerning since Aluminium Composite Panel (ACP) cladding has been used on buildings in Australia for over 30 years.

Should you be worried?

The short answer is yes, you should be.  Combustible ACP presents a significant increased risk to occupants and property in the event of a fire.

Another aspect to consider are legal issues. The NSW government has banned certain types of ACP,so it is very important you inspect your buildings. While there has yet to be a lawsuit against building owners by tenants for loss, damage or injury stemming from non-compliant use of ACP, there is clearly a risk for claims arising in the foreseeable future.

Inspecting external cladding

Assessing & managing risk

Building owners should bear in mind that the use of ACP does not necessarily mean that the building is non-compliant or unsafe. Expert assessment is required to determine whether the cladding is building code compliant and/or whether it poses a safety risk.

When assessing the exposure and how it relates to your assets, the following may help identify the level of risk you are exposed to:

  • Continuous sections of combustible ACP provides a pathway for external fire spread.
  • Combustible insulation materials located behind the ACP add to fire load and can increase fire intensity.
  • Fire sprinkler systems for offices, educational institutions, hotels and hospitals are typically designed to operate over a relatively small area. Therefore, a rapidly spreading fire via external ACP cladding can overwhelm the fire sprinkler system, affecting its ability to control internal fire spread and result in increased damage.
  • Fire rated compartments can also help to reduce internal fire spread (floors/walls), however, the Fire Resistance Level of the fire compartment needs to be considered. In the event of a major fire, smoke and water damage to areas not directly involved in the fire is likely to occur.
  • The likelihood of a fire due to ignition of combustible ACP’s is increased where ACP’s are located in close proximity to:
    Balconies that are not protected by fire sprinkler systems;
    Street level; and
    Other high-risk areas such as near loading docks, stored combustible materials, waste bins, electrical systems, hot exhaust flues and smoking areas.

Here are a few suggestions to mitigate risk:

Conduct an audit to identify the type of external cladding

To determine the type and extent of ACP cladding on a building, you’ll need to do some research. You may need to request construction drawings, specifications, fire engineering reports, building certification documents or other relevant information that includes details of façade materials.

Establish combustibility and whether it is compliant

ACP’s with a core comprising of a large proportion of PE, EPS or PU are at a higher risk of combustibility. These material types would be considered less desirable to have on building exteriors. To determine the combustibility of ACP, details of make and product specifications (that include fire test criteria) are required.

Most product specifications include certification to various fire test standards.  If product specifications are not available, the type of ACP core material can be checked by visual inspections. This is done by looking at openings, removing a section, or drilling a hole in the ACP. Accredited building practitioners should be used for any such inspection. The type of substrate and insulation behind the ACP and fixing methods should also be checked at this time.

Samples of core material can be tested by the CSIRO – Materials & Infrastructure Services to verify the type of core material. If there is any doubt as to the combustible nature of the core material, testing should be undertaken.

The use of limited combustibility and non-combustible ACP’s is more common in recent years, however older buildings are more likely to have 100% PE core panels.

Create a risk management plan

While you await the removal of the ACP, strict risk management controls should be implemented, including the formalisation of a panel management program. The panel management program needs to consider the following as a minimum:

  • Detailed plans of the panelling should be drawn‐up and documented so that everyone is aware of their exact location and type.
  • Panels should be completely sealed, and maintained in good condition.
  • Any holes or damage to panels should be either replaced or repaired.
  • Any alterations to the building which impact the ACP should be carefully planned by the appropriate expert.
  • When work is undertaken power tools and cutting equipment must not be used.
  • Electrical and other services penetrating panels should be fitted with non‐combustible, fire rated sleeves to the full thickness of the panels.
  • Equipment and cabling should be subjected to increased frequency of electrical testing, including thermographic inspections.
  • Storage should not be located in close proximity to the panels.
  • A regular documented inspection plan must be carried out and holes or damages repaired as above. Management must check the logs monthly.
  • Hot Works near combustible ACP should be tightly controlled and avoided where possible. Never permit any form of hot work on the combustible ACP and use a Permit to Work system at all times.

Examples of ACP and their combustibility

Chubb, a leading global insurer, has provided a sample of Non-Combustible, Limited Combustible and Combustible products, however it is important that you engage the right specialist to identify your ACP product and its combustibility.

Non-CombustibleLimited CombustibilityCombustible
Alucobond A2

Alpolic A2

Nu-Core A2

Vitracore G2


Alucobond Plus

Alpolic FR

Alucobond PE



Fromwall 1000

Other 100% PE panels

About Lockton

Lockton is a global professional services firm with 7,500+ associates who advise clients on protecting their people, property and reputations. The company has grown to become the world’s largest privately held, independent insurance broker by helping clients achieve their business objectives.

Lockton Australia provides risk advisory and insurance services to clients throughout. We have extensive experience in designing and placing robust insurance programs according to the individual requirements of your company.

Date: 04 October 2019 Author: Stephen Cooper

About the author:

Stephen Cooper

Lockton | National Manager, Real Estate & Construction Qualifications: BSc (Hons) Engineering, Dip CII, ANZIIF (Snr Assoc). Stephen is the national practice leader of Lockton’s Real Estate and Construction practice within Australia and responsible for driving growth and development in Australia and across Asia Pacific. Stephen is an experienced insurance broker in the insurances of FTSE 100, HKXe and Fortune 500 real estate companies from his time with Jones Lang LaSalle (London) and JLT (London, Hong Kong, Australia and New Zealand).

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