Clay flue liners are used in Masonry chimneys to vent products of combustion smoke, gas, and moisture to the atmosphere. They also protect the chimney walls from heat and corrosion. A properly installed and damage-free clay chimney liner will aid in the optimal performance of your heating appliance.
Clay tile usually comes in 2-foot sections and should be stacked nearly vertical. Sometimes they have a slight offset to accommodate for a second fireplace or furnace, but they should not be built in a manner the off-set effects the flow of smoke and gases. The flue tile should also have no less than 1/2 airspace between outer tile and inner masonry walls to allow for thermal expansion.
When constructing the clay tiles, NFPA 211 calls for a medium-duty non-water-soluble calcium aluminate refractory cement mixture. Most masons don't use anything other than masons mortar because it's the way they were taught to build it, they are uniformed or too cheap to use the specified mortar. I've yet to meet a mason that owns a copy of the NFPA 211 or IRC code book.
In the 1920s chimneys began to be built with clay liners. Most chimneys we encounter before this period are unlined and consist of just brick and mortar. This is not only concerning for carbon manoxide transmission, but also for heat transfer to neighboring construction material,
The best solution for a chimney with no liner is a stainless steel liner system, they not only have a higher heat rating it is often more economical as well. If your chimney does not have a liner in it rather it's a standard fireplace, woodstove, gas, or oil furnace, I strongly recommend contracting a chimney professional to install one, it could just save your life.
Inserts and freestanding stoves are not recommended for clay tiles. As they produce heat into the living space, via radiant or forced air, (Blower), it lowers the flue gas temperature of the chimney producing more creosote and making your chimney more susceptible to a chimney fire. A proper liner, as well as a direct connect, is recommended.