Over the past decade EPS insurance has quickly grown to be one of the most expensive and hard to place insurance policies on the market. This sudden price hike has a lot of consumers scratching their heads and wondering why their premiums have doubled.
This price hike is due to a lot of factors, but the most relevant in Australia can be traced to two highly publicised fires at processing plants. These incidents have left many insurance underwriters limiting their exposure to EPS related risks or refusing to take on properties containing any EPS all together.
What is Expanded Polystyrene?
EPS panels are insulated sandwich panels that are typically made up of two metal sheets bonded to an insulated foam core. They were extremely popular before 2010 because they’re light-weight, cost effective, and easy to use for insulation. This means older buildings are more likely to have traditional EPS. EPS panels are most commonly found in the hospitality, and pharmaceutical industries as well as in many other industrial settings.
The reason EPS is so dangerous is because of two main factors. First, the foam core is extremely flammable, and it only takes a small amount of heat or a few sparks from nearby work or an electrical device to cause combustion. Second, once the fire has started it spreads quickly and invisibly throughout the panels. As soon as a fire begins the panels deteriorate quickly and structurally collapse, this spreads molten plastic and furthers the fire. This will lead to a weakening of the building’s structural frame. Within a few minutes an EPS fire can quickly spread out of control and eventually cause the collapse of a building.
Why is EPS Insurance so Expensive?
So, we’ve established that EPS is very flammable. This, crossed with a number of highly publicised major fires, and the added difficulty of assessing and insuring the panels means that EPS insurance has become one of the most expensive policies.
In 2016 a fire broke out at a bacon factory, SunPork Fresh Foods’ Swickers, in Kingaroy, Queensland. It was the largest pork processing plant in the southern hemisphere and parts of the plant, including the boning room, distribution area and chillers, were burnt to the ground. The source of the fire was later established to be the EPS paneling.
A similar case occurred two years later at the Thomas Foods International abattoir at Murray Bridge in Adelaide. Thomas Foods was one of Australia’s biggest abattoirs, with exports to over 80 countries. The fire burned for several days and caused tens of millions of dollars worth of damage. It was caused by sparks from welding nearby igniting the foam, and fire crews struggled to extinguish the fire because of the panels.
Since those two fires The Australian Institute of Building Surveyors has issued a warning to be aware of the dangers of insulation cladding. They warned that it is extremely dangerous in both commercial and residential properties Prior to that statement many officials had focused primarily on medium to high-rise buildings.
Authorities have also noted that the EPS sandwich panel fire risk is very high due to the fact that they’re normally wedged behind concrete, plaster, or sheet metal. Metal sheeting can prevent fire crews from extinguishing a blaze or being able to tell if the fire has continued to burn.
If you’re concerned about the rising cost of EPS insurance there are lots of different ways you can try to reduce the risk in your home and business. Alternatively if you’d like to speak to an insurance expert about the hazards and available insurance policies then the team at Ausure Horizon would be happy to help you. Ausure Horizon specialises in EPS coverage and can help you figure out which tactics will help to keep your property safe and which policy might best suit your needs. If you’re interested then contact the team at Ausure Horizon today!