As commodity prices continue to rise the mining sector is set to reap higher profits.
Whilst these profits are considerably positive for the mining business they also open up an increased amount of exposure to price fluctuation. As regulations and ethical mining continue to play a major role in the industry we are seeing changes in the scope of coverage that insurers are willing to offer. This is particularly relevant in thermal coal mining where some insurers are withdrawing from covering the Property and Construction capacity for thermal coal mining. In light of this thermal coal miners should check their policy and relationship with their long term insurers. In conjunction to this, more detailed and technical underwriting information is required and the renewal process is taking longer.
- Commodity price fluctuations and changing basis of Business Interruption (BI) declaration
- Stable underwriting capacity with some announcements of withdrawal of Property and Construction capacity for thermal coal as ethical underwriting continues to grow
- There is an upward pressure on rates and premiums.
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