Subpanel with fuses and aluminum wiring 1940 home - safe?

[Warren A.]

I closed on a single family home in Little Rock, AR in mid May 2021.  It was built in 1940 and is ~1700 sq ft. The tenant is a Housing tenant (section 8) , has not moved in yet , but has passed the Housing inspection.   Below is a snippet from our 3rd party inspection report noting concerns due to the subpanel having fuses and some aluminum wiring.  I am not an electrician but everything I have googled and searched on BP mostly suggests that fuses and aluminum wiring are not as safe as breakers and copper wiring.   

I have insurance coverage but am not sure our insurance company is even aware and afraid they could deny claims in the future if a fire is sourced to that subpanel with fuses or aluminum wiring.   The seller offers a 90 day warranty.   I have a good relationship with the seller (I have other properties managed by them) but in this case, I feel I've had to follow up a few times to get a 2nd licensed electrician to offer a 2nd opinion.  A second electrician has finally contacted me yesterday, we spoke on the phone, and I shared the photos and a brief description so far.  Initial reaction from the second electrician did not seem too concerned but what we agreed for next step was for me to send him the inspection report  (sent yesterday July 2) and we would go from there.  Side note: I went to electrician website and do not see a license # (red flag?) .  So now waiting for his evaluation.  Lesson learned to not agree to close until all punch items are closed.

My question to BP community.  Based on above, are the fuses and aluminum in this house a real concern ?  Suggestions on how to handle?

Inspector report:

Below is response from 1st electrician stating fuses and aluminum are safe. 

and

[Matt Devincenzo]

TLDR; I would not necessarily replace the panel immediately, but would get it planned for the immediate future, and would plan on having the aluminum ends/connections addressed in the short term. 

As your electrician noted fuses and aluminum wiring are both commonly used...the issue is the are commonly used in utility and industrial scale settings. The reason being the 'professionalism' of those that are using them, and their recognition of the limitations and willingness to fix things properly. Like Jim noted above the problem is that residents will bypass the fuse protection when a replacement fuse isn't immediately on hand. That is what creates the fire hazard, not the fuse itself. Similarly aluminum wiring is commonly used for your utility distribution and transmission lines in large part because it is much lighter which makes the long runs between poles easier. The problem with aluminum is two fold 1) when the ends oxidize they will be more likely to overheat, melt and possibly burn 2) it expands and contracts more than copper which can lead to gaps at the connection again causing possible arcing, overheating and possibly a fire. 

So what I would do immediately is ensure I had spare fuses to provide the tenant so they won't do the first thing Jim mentioned. Second I would ask the electrician to inspect the ends, possibly re-do the connections (remove the very end that could be corroded) and reconnect them with the proper connectors. There are protective electrical coatings which exclude the air and prevent corrosion, that is what the utilities use to ensure their lines are protected. There are also a couple of specific aluminum to copper transition connectors which are a permanent repair option that doesn't require a complete rewire. The copper ends are then connected to the switch or outlet, which eliminates the expansion/contraction issue at the screws which is the source of the issue. The problem is Harry Homeowner doesn't know how to do it right and burns the house down. Doing these two things should give you peace of mind, and then you can plan for the upgrade and replacement in the next few years if you decide it is necessary.