I'm looking at a similar situation. It looks like a log burner needs a double skin insulated flue or at least that's what I am being told. To be honest I would get it changed anyway.
i've checked and it is double skin, the flue, and it's a relatively thick steel and is from 800mm off the floor to above roof level. it was installed long before i moved in and i've found lots of examples where the elderly couple who owned the place were fleeced by people who did work here: the most disgusting was the thermal insulation in the loft. it's an old trick apparently but they'd only put the fibre glass wool around the edges of the chipboard flooring they'd put down. i think it could be that they over engineered and over-charged the elderly couple and installed a flue they really didn't need.
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