Compulsory checks for combustible cladding
Following the Grenfell Tower fire tragedy, the NSW Government announced a wide-ranging fire safety package in response to the fire safety risks posed by external wall cladding.
As part of the package, the NSW Government announced they would make checks for combustible cladding on buildings compulsory. The Department of Planning and Environment is now formalising a draft regulation that proposes that owners of buildings with combustible external wall cladding will be required to register the building with the State Government.
Under the proposed regulation, these building owners will be required to submit a cladding statement to the Department of Planning and Environment. This must be provided by an independent qualified inspector (A1 and/or C10 certified inspectors) within 3 (three) months of the enactment (expected this month) or issuance of Certificate of Occupancy.
Cladding and your duty of disclosure
Cladding is considered a popular material used to cover a building’s external wall or roof due to its light weight, architectural features, resistance to corrosion and many other benefits. A cladding material currently in focus is Aluminium Composite Panels (ACP).
The focus is due to non-conforming cladding identified as the promoting factor to the rapid fire spread of Melbourne’s Lacrosse Apartments, and more recently, London’s Grenfell Tower.
Some insurers have started to ask for more details in relation to cladding materials installed at a premises. Prior to providing terms the insurer may require specific details such as the type of material, location, approximate percentage installed in the building and the manufacturer. We anticipate all insurers will implement this additional line of questioning in the future.
Duty of Disclosure
Section 21 of the Insurance Contract Act 1984 requires the insured to disclose all material information that is relevant for the insurer’s decision making process. As part of your duty of disclosure, it is imperative to know and provide the information about the cladding material, any non-compliant material in concern or potential existence of cladding to your insurer. You will then need to obtain their confirmation regarding the implication to the current insurance cover.