compromised insulation

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gazzoo

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Hi everyone, I enjoy reading all the brain power in these posts and was hoping for a little help.
I was ask to prepare a bid for 2 apt building's hall lighting. They were built in '72 and 12-2 bx was used to supply the lighting in the hallways. The light fixtures are basically decorative circle line florescent. I dropped down 5 fixtures and found that the insulation is charred, hard and not in any condition to withstand any more heat let alone any type of load. It seems to be TW insulation but it is hard to tell. The insulation is fine about an 1" away from the connector in the box; I was wondering if there is any products on the market that can be installed over the copper and/or insulation that would bring the insulation factor to 90 degree Celsius (like thhn). Therefore allowing me to install new lighting without having to derate the original wiring.
Any comments would be appreciated.
 
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