Insurance headache for hydrocarbon refrigerants

Workshops using hydrocarbon refrigerants in vehicle air-conditioning systems could be pursued by insurance companies if any damage to a vehicle is caused by the use of flammable gases.

This is in addition to the myriad possible refrigerant handling or occupational health and safety infringements that could occur during the process of filling an air-conditioning system with hydrocarbons.

But let’s get back to the insurance issue – after much passing the buck between various insurers and the Insurance Council of Australia, who flatly refused to comment on the matter, AAMI confirmed what VASA has long suspected.

“If there is an accident/incident involving a car this hydrocarbon refrigerant has been installed in, and some of the damage is directly attributed to the workmanship of the installer, then an insurer, while covering the car owner, may seek to recoup losses from the installer/tradesman,” said AAMI corporate affairs manager for personal insurance Reuben Aitchison.

It doesn’t take a genius to figure out that highly flammable gases flowing around the hot engine compartment of a car could easily catch fire or explode if components were ruptured during an impact – and that such a fire or explosion would be far less likely were a non-flammable refrigerant used.

As only Queensland really outlaws the use of hydrocarbon refrigerants in systems not designed or adapted for them, vehicle owners across most parts of Australia remain covered while hydrocarbons are in their vehicle’s air-conditioning.

“The answer to this depends on the legal status of the hydrocarbon refrigerants,” said Aitchison. “If it can be used legally for auto air condition systems, then the insurance cover is unaffected.”

But it is less clear what happens if an interstate vehicle crosses the border into Queensland.

From a workshops point of view, Aitchison warned that “there may be commercial insurance safety/risk management for workshops if flammable materials are being used onsite that weren’t before”.

Declaring an intention to work with flammables to an insurer could cause premiums to increase due to the increased risk.

“Best to check with your insurer,” was the advice from Aitchison to vehicle owners and workshops alike. “You don’t want to find out at claim time that you are not covered.”

One of the issues surrounding hydrocarbon refrigerants is the lack of any licensing requirements – a tempting proposition for anyone wanting to make a quick buck by starting up a quick and cheap air-conditioning regas service.

While a quick top-up with hydrocarbons is unfortunately legal in most Australian states and territories, anybody who recovers or removes fluorocarbon refrigerant (such as R134a) from an air-conditioning system in order to replace it with hydrocarbons, must hold Restricted Refrigerant Recoverers Transitional Licence at the very least – otherwise they are committing a criminal offence.

The Australian Refrigeration Council (ARC) declined to make specific comments on any plans to introduce licensing of hydrocarbon refrigerants, merely reiterating the fact that its board has said “on record that they would like to explore any opportunity to licence various refrigerants, hydrocarbons included”.

The Department of the Environment provides the following checklist for workshops to follow when using flammable refrigerants, in order to make sure they follow the strict standards and procedures each state and territory mandates for their correct use:

• Do you have appropriate training, skills and license to install and maintain the equipment?
• Is the equipment for use only for a specific HFC whereby substituting with an alternative gas could introduce safety hazards?
• Are you certain of the type of refrigerant gas currently in the equipment, has this been labelled and has it been checked prior to servicing? Do not assume that the refrigerant in the equipment to be serviced is non-flammable. Always check the identity of the refrigerant in the equipment, using a safe method that does not pose an ignition hazard, before beginning work on the equipment.
• Can you legally use an alternative refrigerant (such as hydrocarbon which is flammable) for the particular purpose in your state or territory? Are you aware of the current regulatory controls and standards, codes of practice and other relevant guidance?
• If you can legally use an alternative refrigerant (such as hydrocarbon) for the purpose, have you conducted a comprehensive risk assessment to determine if it is safe to use an alternative refrigerant that is flammable or toxic or operates at high pressure in the particular circumstances?
• Has the unit’s manufacturer and the refrigerant supplier approved the use of a flammable, toxic or high pressure refrigerant in the system?
• If a retrofit is to be undertaken, how can you assess the safety and suitability for purpose?
• Has the equipment manufacturer given approval for retrofitting the equipment using an alternative refrigerant?
• Has the owner or user of the refrigeration or air conditioning equipment been advised that a flammable, toxic or high pressure alternative refrigerant is proposed to be used, been made aware of the risks involved and given written approval to its installation?

Consumers having work done on their vehicle air-conditioning systems are advised to consider:

• Does the technician have the appropriate training, skills and licensing to install and maintain the equipment?
• Have the technicians explained what work they are doing and why and outlined any risks associated with the work they are doing?
• If a flammable refrigerant is proposed to be used, have you been made aware of the risks involved and have you given written approval to proceed with the installation?
• Replacement of synthetic greenhouse gases in equipment with an alternative refrigerant may void the equipment warranty or have insurance implications. Ask the technician and check with the equipment manufacturer and your insurer.

The above is all food for thought – how many of these checklist points do you think were considered on the last air-conditioning system you saw that contained flammables?