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Perspective

Green Alternative to Traditional Drywalls Blamed for Millions of Losses in Denmark

November 03, 2015| By Yves Marquard | General Liability, Property | English

Region: Europe

Magnesium oxide (MgO) mixed into cement to create thin panels, known as MgO boards, have emerged as the greener alternative to traditional drywalls in recent years. While they are not organic, tests show that MgO boards are not damaged by water; they are resistant to mold, non-combustible and quite resilient to impact. MgO boards hold up well when frozen and thawed while being solid enough to fix nails and screws. They are also used as wind barrier boards to insulate against the cold, wind, noise, in addition to stiffening exterior walls and ceilings.

Since 2010, MgO boards have largely replaced traditional gypsum drywalls in the construction industry in Denmark. Not only are they considered to be greener, they are also inexpensive. Up to 100,000 square meters of MgO boards (most of which were made in China) were being sold every month in Denmark. Now losses allegedly caused by MgO boards are being reported. The first cases were conveyed in the autumn of 2014. MgO boards contain salt, which draws moisture from the air. When the salt is saturated, the MgO boards start releasing moisture (saltwater).

Stories of families that have to spend huge amounts of money on repairing their homes and public buildings infested by mold have appeared in Danish papers. While the extent of the problem remains unknown, estimates by Ingeniøren, a Danish journal for engineers, put the cost of removing the boards in 69 public buildings at more than EUR100 million. MgO boards have been used in at least 20,000 apartments in public housing in Denmark. The extent of their use in private housing and buildings is unknown.

The latest research shows that literally all MgO boards sold and/or delivered in Denmark will have to be withdrawn from the market, according to a recent report by Ingeniøren. The impact on the insurance industry could be significant. The potential insurance cover for MgO boards includes:

  • Product liability, including rip, tear and reinstallation cover
  • Professional indemnity for the consultants
  • Contractor’s liability
  • Decennial type guarantees
  • Claims against property insurance covers for the resulting property damage caused by the boards

 

MgO importers and their insurers will have the burden of having to try to take recourse with the Chinese manufacturers under Chinese law, which may very well prove difficult. So how did this happen? Some experts say that the boards should have been sealed in order to prevent water penetrating the boards. Others point to quality problems. Interestingly, this appears to have been a Danish phenomenon for now. Could it be due to the climate? Is the issue bound to affect buildings in other countries? While the extent of the damage in Denmark becomes more apparent, we’ll be watching to see whether this problem affects markets elsewhere.

Source

Ingenioren articles on MgO boards: http://ing.dk/sog/mgo

 

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