Ceiling insulation is the use of a material to reduce the thermal conductivity (or basic heat transference) via the ceiling and into the space beyond it (namely the roof void). Most often this is achieved through the use of strips of material between the ceiling joists that are often several inches think. The material being able to trap a large amount of still air in relation to its size - this 'trapping' prevents the air transfering heat so prevents the heat loss from below.
Also when the roof space heats up during a hot day it similarly prevents the conduction of the heat into the living space below.
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