Rechargeable lithium-ion batteries, found in many household items, are crucial for Australia's net zero emissions goal but pose safety challenges. Incidents of these batteries overheating or exploding are increasing, leading to significant fire risks and insurance claims. Strata insurance covers building damage but not personal items, and insurers are monitoring the evolving risk landscape. Mitigation involves regulatory actions, consumer education, and proactive measures by strata schemes.
Lithium-ion Batteries: A Double-edged Sword
Crucial for Net Zero Emissions: Lithium-ion batteries are essential for reducing carbon emissions.
Safety Risks: Incidents of batteries overheating or exploding are on the rise.
Causes: Misuse, exposure to heat or moisture, and damage can lead to overheating or explosions.
Impact on Strata Insurance
Increased Claims: Allianz reported a significant increase in claims and costs for lithium battery fires.
Coverage Limits: Strata insurance covers building damage but not personal items.
Future Exclusions: There are no specific exclusions for lithium battery incidents yet, but this could change.
Costly Claims: Lithium battery fire claims are costlier and take longer to resolve.
Taking Action to Mitigate the Risk
Regulatory Framework: ACCC urges a unified regulatory framework for lithium batteries.
Safety Measures: Insurance Council of Australia recommends measures for EV and personal mobility device safety.
Battery Stewardship Scheme: Expand the scheme to include EV batteries.
Regulation: Strengthen regulation for personal mobility devices.
Consumer Education: Educate consumers on the safe use and maintenance of batteries.
Risk Modelling: Work with insurers on risk modelling for the EV transition.
Proactive Strata Schemes
Risk Awareness: Improve risk awareness and ensure appropriate insurance coverage.
Safe Charging Guidelines:
Charge away from combustible materials.
Let batteries cool before charging.
Disconnect when fully charged.
Storage: Store in cool, dry places and avoid using damaged batteries.
Disposal: Do not dispose of lithium batteries in household garbage or recycling bins.
Stay Informed: Follow manufacturer instructions for maintenance and servicing.
Stay safe and informed to mitigate the risks associated with lithium-ion batteries while contributing to Australia's net zero emissions goal.
For more information check out the full article from Body Corporate Brokers.
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