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1、Mining market update 2024Mining market update 20242 2Contents03Introduction05Market conditions in key mining hubs05International property market06International casualty market07Domestic market conditions12Directors and officers liability market13Strikes,riots,and civil commotion market14Specie marke

2、t15Cyber market16Cargo market17Construction market17Reclamation bond market18Political risk market20Summary:Client considerations21Solutions23ContactsMining market update 20243IntroductionThe mining industry is essential for enabling the global economy to transition to a more sustainable future.Whil

3、e the rising demand for metals and minerals will provide economic opportunities for mining companies and resource-rich countries,the industry must also address its own challenges to stay competitive and contribute to global decarbonization efforts.For several years,the mining industry has faced a co

4、mplex operating environment,influenced by many factors,including pressures around supply and demand,social unrest,regulatory changes,environmental pressures,and shifting investor sentiment.Physical climate risks are also adding to pressure on the industry.Despite these challenges,minings crucial rol

5、e in the energy transition and infrastructure development creates opportunities on a scale that many companies have not previously encountered.In addition,while new mining techniques that leverage advanced technologies can create additional risks,other uses of technology,such as artificial intellige

6、nce(AI),hold the potential to improve outcomes across the mining supply chain.Central to an effective response to these interconnected political,trade,macroeconomic,climate,and other risks is a robust risk management strategy so that business leaders can strengthen their ability to identify,prepare

7、for,and mitigate time-sensitive challenges.Mining market update 20244Defining sustainabilityThe decarbonization imperative is putting pressure on the mining sector in several ways,including responding to increased demand,complying with regulations,and building climate resilience.Mining companies mus

8、t balance the interests of multiple stakeholders,including investors,governments,regulators,customers,and communities as scrutiny on environmental,social,and governance(ESG)issues increases throughout the mining value chain.Gaining stakeholder trust and perceived financial incentives are major drive

9、rs behind steps to improve efficiencies and reduce minings carbon output.As stakeholders demand greater transparency and accountability,underwriters are paying close attention to mining companies ESG practices.The increasing frequency and severity of weather-related events,particularly in Latin Amer

10、ica,is another challenge that mining companies must navigate,given the range of business impacts weather-related events can have on operations and supply chains.To address these challenges,Marsh and Oliver Wyman have launched a new platform,Sentrisk.The platform helps clients uncover and manage thei

11、r supply chain risk exposure,reducing volatility and avoiding or mitigating the impacts of losses.Satisfying demand amid price volatilityTo date in 2024,commodities have shown mixed performance.The resilience of gold,silver,and copper contrasts with the weak pricing of most other minerals.This prici

12、ng divergence underscores the need for careful risk assessment and diversification strategies to navigate volatile market conditions effectively.Emerging technologies and cybersecurity risksThe mining industrys adoption of automation and investments in advanced technologies,such as augmented reality

13、(AR)and artificial intelligence(AI),are improving efficiency,safety,and sustainability efforts.However,increased reliance on technology also heightens cybersecurity risks.In recent years,the industry has seen a rise in cyberattacks,which can impact operations,revenue,and reputation.Ransomware attack

14、s,loss of employee data,and operational disruptions have become prevalent,highlighting the industrys vulnerability to digital threats.Losses and claimsOver the past 12 months,losses tracked higher than might have been expected.Underwriters are particularly concerned with the structural integrity of

15、assets and the availability of spare parts inventory,as both impact loss mitigation and ultimately insurers financial positions.Mining operations also have faced severe disruption from port blockages.Recent incidents at the Port of Baltimore in the US,and at Australias South32s loading wharf disrupt

16、ed supply chains and caused substantial financial losses.These events highlight the vulnerability of mining operations to external factors outside the control of operators.Insurers and mining companies must collaborate to develop contingency plans and risk mitigation strategies to prepare for and ad

17、dress such events and minimize their impact on operations.Realizing the opportunityIn a market where positive outcomes can be achievable for clients considered to have attractive risks,insurers are likely to remain focused on clients responsible behavior and approach to risk management.Mining market

18、 update 20245Market conditions in key mining hubsINTERNATIONAL PROPERTY MARKETOver the past year,several new insurers entered the London(re)insurance market for mining risks in the direct and facultative(D&F)space,both locally and internationally,adding capacity and spurring competition.Despite comp

19、etitive domestic markets,the London market was often preferred by clients who had experienced large losses and sought diversity of placement and the ability to spread losses globally.Commodity price fluctuations underscore the necessity of conducting annual reviews of policy limits.Due to this volat

20、ility,many companies have adjusted their coverage accordingly.However,companies should exercise caution when modifying their limits and make it a priority to revisit the issue regularly.It is uncertain whether reduction in rates will lead to less frequent insurer insistence on business interruption(

21、BI)volatility clauses.Mining market update 20246However,increased competition in the marketplace has led to some placements without such clauses.The excess of loss market remained more constrained than other parts of a program,meaning that volatility clauses often remained.Clients should review thei

22、r business interruption calculations early in the renewal process and potentially undertake a third-party audit by forensic accountants.Since insurers have been including volatility clauses,organizations have often taken greater care in developing their business interruption declarations,which has a

23、ided them during claims situations.The number of claims from mining clients was high in several regions due to underground longwall fires,inaccessible export terminals,snowmelt damage,rain inundation,and underground flooding.Drawing on experiences from recent claims,a working group within the Mining

24、 Risk and Insurance Association(MIRA)and the Lloyds Market Association(LMA)is focusing on specific clauses in mining policies.In Bermuda,capacity for mining risks remained stable,as there are many longstanding relationships.Many Bermuda insurers opted not to write thermal coal risks,allowing for opp

25、ortunities and expansion in other areas.Mining risks are primarily categorized as being within the energy sector and can be seen as an additional or complementary part of the overall property portfolio.As a result,mining benefits from the synergies and overall strength offered by the property market

26、,creating a favorable environment for increased market competition.Barring any significant market disruptions,we expect this trend to continue for the rest of the year.Given the technical nature of mining,there was a strong emphasis on risk quality and engineering.Accuracy of values remained a prior

27、ity,and organizations should expect to reflect changes in commodity prices in their BI declarations.In general,property insurance rates trended downward recently in the European marketplace.Insurers placed greater emphasis on the adequacy of sums insured due to commodity price fluctuations.The price

28、 of gold was of particular concern,leading to insurers focusing greater attention on BI and the assumptions underlying clients submissions.Increased inclusion by insurers of commodity price caps was observed.When preparing forward-looking insured values,insureds were encouraged to consider current m

29、etal prices and align their budgetary assumptions with general market conditions and expectations.This could help avoid proposed restrictions on policies.ESG factors continued to receive increased attention,especially from European insurers.Capacity allocation and participation from major reinsurers

30、 was increasingly reliant on insureds minimizing their ESG footprint.Insureds needed to be prepared to address third-party concerns,mitigate adverse publicity,and incorporate sustainability factors into their insurance submissions.Lesser focus on ESG factors can result in insurer capacity being eith

31、er withdrawn or not offered in cases where reputational risks remain.INTERNATIONAL CASUALTY MARKET In the past year,mining liability coverages generally experienced moderate rate increases of flat to 5%alongside competitive dynamics.The reinsurance market for international casualty risks for mining

32、companies generally experienced small rate increases.For US mining risks,the London insurance market focused on line sizes and layer placement,as US domestic liability insurers typically offered smaller blocks of capacity.Over the past year,many mining clients experienced moderate rate increases of

33、5%to 10%for liability coverage,due in part to inflation and the long-tail nature of liability risks.Amid an increasingly litigious environment,insurers continued to focus on large jury verdicts in the US,as well as environmental and health concerns,particularly related to per-and polyfluoroalkyl(PFA

34、s)substances and the potential legal costs involved.Underwriters requested more detail and transparency around the use of PFAs,or sought to exclude coverage altogether.ESG performance continued to be a priority for insurers,although a direct correlation with pricing has yet to emerge.The ESG focus t

35、ended to be across the entire portfolio spread,not solely mining risks,and ensuring that risks with ESG criteria were included in clients portfolios to demonstrate ESG scoring in risk assessments.As such,submissions that included relevant ESG information,including plans for business model diversific

36、ation,decarbonization,and sustainable product solutions,were generally looked on more favorably by underwriters than those without such details.In China,dynamics have shifted,primarily due to a major reinsurer reducing contractual support in the direct market.This shift created a demand for addition

37、al international reinsurance capacity,which has been typically more costly and drove overall rates higher.Local insurers have restricted coverage for strikes,riots,civil commotion(SRCC),and terrorism,despite increased client demand.In Indonesia,domestic property rates followed international rate tre

38、nds,which showed stability or slight reductions for well-managed non-coal risks.Coal risks remained prevalent,however,local insurers reduced support to align with guidance from treaty and facultative reinsurers.Additionally,Indonesia limited the number of co-insurance participants to eight re-insure

39、rs,down from the previous norm of around 20.Reduced local insurance capacity led to a greater reliance on international reinsurance,which continued to drive overall rates higher.The Indonesian market also experienced coverage restrictions,particularly regarding sub-limits for port blockage extension

40、s.Mining market update 20247Domestic market conditionsOver the past year,mining insurance rates in Asia generally decreased in the single digits.Local mining companies typically placed their liability risks in domestic markets rather than international reinsurers,a preference stemming in part from r

41、egulatory differences.Relatively low liability limits were generally placed with local markets through treaties or co-sharing arrangements,resulting in competitive domestic pricing.Additionally,local insurers typically did not differentiate mining risks from other industrial exposures to the same ex

42、tent as international markets.In Singapore,international property reinsurance rates had showed small reductions,on average,for well-managed risks outside major natural catastrophe(Nat Cat)zones.However,high-risk operations generally experienced stable or small increases in the range of 5%.Coverage f

43、or machinery breakdown(and resultant business interruption),Nat Cat,tailings,and underground losses remained sub-limited by many insurers,and power supply continued to be an area of underwriting scrutiny.ESG factors remained a core focus across international markets.The deployment of capacity was ty

44、pically dependent on effective tailings storage facility(TSF)monitoring and thorough third-party risk reviews,along with sound policies for pollution prevention and monitoring,biodiversity preservation,conservation,community involvement,and protection of local communities.Additional capacity was ava

45、ilable for clients that primarily used the international reinsurance market,which helped reduce reliance on typically higher cost excess markets.The local Singapore market continued to evolve as a decline in local capacity has led to greater reliance on international reinsurers.Deductibles remained

46、generally lower in local markets,compared to international markets.Clients should review their deductibles at renewal to determine if changes could positively impact pricing.SINGAPORECHINAMining market update 20248In the past 12 months,the domestic market in Australia has seen significant losses due

47、 to weather events.These losses prompted increased scrutiny of policy terms,conditions,and operating protocols.Weather-related losses also led to continued underwriter focus on Nat Cat exposures related to Australian operations.Nonetheless,local insurers remained committed to growth and are working

48、to create a more favorable local market for clients.Commodity price volatility led insurers to adjust terms and conditions to better quantify maximum exposures,often through commodity price caps.In some instances,insurers may have considered coinsurance and premium adjustment clauses,but these provi

49、sions were not common due to increased market competition.Clients often benefitted from a BI review to test the values presented to insurers.Many clients undertake independent asset valuations on a three-year rolling basis.As always,maintaining up-to-date risk recommendations and proactive communica

50、tion with insurers risk engineers can keep clients in a strong position.This should be paired with high-quality underwriting submissions that are prepared and presented early to insurers.We have found that improved outcomes often result from engaging with insurers sooner,so clients should collaborat

51、e with their brokers to refine renewal timelines and continue to seek this advantage.AUSTRALIAMining market update 20249The property insurance market in Canada was dynamic and competitive,with insurers typically offering favorable terms and rate decreases for clients unaffected by losses.While some

52、rates decreased in the flat to low single-digit range,insurers generally started negotiations with low single-digit increases.The oversubscription on placements and decreasing rates indicated that competition drove favorable outcomes for some clients.In general,insurers did not tend to push for high

53、er retentions after adjusting their portfolios retentions in the past three years.Engineering continued to play a critical role in submissions,with underwriters placing importance on risk recommendation progress and structural integrity.Where concerns arose,technical underwriters typically requested

54、 structural integrity reports.Canada saw new insurers in the mining space,with another actively expanding its mining presence.The rate environment for Canadian casualty markets moved towards low single-digit decreases,and insurers were increasingly willing to underwrite multiple casualty lines.Certa

55、in exposures,such as tailings,heap leach pads,and pollution,received greater scrutiny.In the financial lines market,rate reductions generally stabilized.Insurers were actively seeking new accounts,while incumbents aimed to retain existing ones.Insurers offered various benefits,including more primary

56、 market options,higher limits on previously reduced layers,lower attachment points,and additional layer participation.It is worth noting that growing disclosure requirements related to cybersecurity and ESG issues could lead to an increase in claims activity.Marine capacity for the Canadian mining i

57、ndustry remained abundant,although there was increasing underwriting scrutiny due to environmental concerns,ESG,bulk shipment,and misappropriation losses.Rates varied depending on geographic footprint and loss experience,with potential decreases ranging from 5%to 7.5%.The London insurance marketplac

58、e continued to be the preferred choice of many clients due to its comprehensive coverage,attractive rates,and available limits.While other North American insurers can participate,it can be challenging to find the same level of coverage or limits,particularly regarding exclusions such as inherent vic

59、e restrictions.The mining sector in Brazil continued to experience significant growth,especially in the critical materials segment,particularly rare earths,lithium,and ionic clay.Many projects are currently in the feasibility or construction phases.Local insurers remained cautious of mining exposure

60、s,as evidenced by their preference for retaining a smaller portion of risks while placing the majority within the reinsurance sector.Insurers tend to consider Brazil a high-risk Nat Cat territory due to the propensity of heavy rainfall in the southern region.As a result,the number of coinsurance opt

61、ions available in the Brazilian market are often limited.In Chile,property rates generally declined for mining companies that did not experience losses and had risk management plans viewed favorably by underwriters.Due to the countrys susceptibility to Nat Cat events,particularly earthquakes,propert

62、y insurers remained cautious when deploying capacity.The increase in losses in the past two years has affected insureds ability to obtain discounts in the limited domestic mining insurance and reinsurance market.The local insurance market primarily focuses on midsized mining companies with insured v

63、alues equal to or greater than US$200 million.However,there are restrictions on underwriting tailings dams and underground mining.As the price of copper,in which Chile is a leading global producer,has increased in recent years,it has impacted the insured values of BI coverage.Therefore,a review of d

64、eclared values is advisable to aim to avoid the impacts of underinsurance.BRAZILCHILECANADAMining market update 202410In 2024,property insurance rates in Peru were flat to low-single digit increases for companies with insured values over US$1 billion and positive loss records.Barring any unexpected

65、changes in conditions,rates are likely to remain flat for the remainder of the year,aligning with international markets,which are the primary capacity providers for Peruvian clients.For companies with insured values below US$1 billion,particularly those involved in underground activities,policies we

66、re primarily placed through local treaties.The international market had limited appetite for underground exposure,leading to continued rate increases in the local market due to higher costs associated with catastrophic exposure.On average,rates increased by more than 5%for clients without claims.The

67、 increases are likely to decrease in the coming quarters,barring unforeseen changes in conditions.Renewals for political risk coverage experienced rate decreases after a challenging 2022-2023 period,when clients received significant increases as a result of Perus political environment.Local and inte

68、rnational insurers excluded political risks from property renewals,making standalone policies the only option.Recent renewals for political risk policies have seen rate reductions,typically averaging 20%.However,securing coverage for social unrest and expropriation remained challenging,as underwrite

69、rs asked for more detailed information on locations,events,and community interactions.Marine cargo renewals typically experienced flat rates or decreased up to 5%for clients with clean loss histories,with a preference for stock throughput or specie coverage.Construction mining projects with a total

70、insured value exceeding US$200 million or involving high complexity(such as tailing dams and tunnels),were typically placed in the London market,where rates generally remained stable.Less complex projects were usually placed in local markets or through regional reinsurance.Since 2023,liability rates

71、 have generally reduced by 5%or less for companies with clean loss records.Tailings coverage remained challenging,with underwriters requesting more detailed information,including stability reports.On average,cyber insurance rates declined by 4%as local mining companies have improved their cyber risk

72、 management practices.In South Africa,property insurers and major African reinsurers showed increased appetite and capacity to underwrite mining business.Local insurers had a strong appetite and capacity for mining risks,both open cast and underground,and participated in multiple accounts and commod

73、ity types.Over the last year,rates typically remained flat or decreased 5 to 10%,despite increases in property values.Insurers,due to losses incurred in the previous two years,placed greater emphasis on overall risk management.In some cases,insurers increased deductibles or imposed exclusions for ri

74、sks they view as below average in quality.The South African casualty market remained competitive,with new insurers entering the market in the past year.Larger mining companies,with dual listings,extensive operations and workforces,and significant exposure to tailings storage facilities(TSF),generall

75、y purchased higher limits by accessing the international market.In the South African cyber insurance market,rates have decreased and coverage generally remained consistent with that offered by global insurers.As mining companies expand,their limits and coverage may need to be revisited and they may

76、need to review their programs holistically with respect to cyber risk,particularly as some property insurers exclude cyber-related losses.SOUTH AFRICAPERUMining market update 202411In the United States,the property market continued to be in a period of transition,with insurers generally offering fav

77、orable renewal rates in the range of-10%to+3%for companies without losses.For US mining companies,readily available insurance capacity stabilized.Competition among local insurers has led to oversubscription of most programs with positive loss records,typically resulting in lower rates.Loss control e

78、ngineering continued to play a critical role and progress in implementing recommendations is closely monitored by insurers,with a focus on critical spares and structural integrity.Losses resulting from restricted access to mines at the request of government agencies,such as the Mine Safety and Healt

79、h Administration(MSHA),may cause property losses to escalate due to time-element exposures.This has prompted discussions with insurers regarding proposed restrictions or exclusions relating to denial of access.However,such cases were not widespread.Given the trend of large jury awards,some US casual

80、ty insurers exercised caution resulting in low single-digit increases.US-based clients faced more challenging placements,as fewer insurers were willing to write multiple key casualty lines.Underwriters scruntinized attachment points,with some US clients seeing decreases from US$5 million to US$1 mil

81、lion.UNITED STATESMining market update 202412Directors and officers liability marketOver the past year,the global directors and officers(D&O)liability market continued to see increased competition,particularly at excess attachment points.Complex placement structures adopted in the more challenging m

82、arket conditions are now being streamlined with clients focusing on larger limit stretches,fewer contracts,and strategic insurers that can provide support over the next three to five years.Underwriters were more open to risks associated with tailings exposure,reflecting the shift towards enhancing s

83、ustainability and health and safety,which remains critical due to the emphasis on ESG factors.Generally,risks that can be managed through the use of sustainable technologies or that are aligned with future-enabling commodities are likely to be more attractive to insurers.Conversely,there is generall

84、y more limited appetite for thermal coal and metallurgical coal among underwriters.Mining clients that maintained their limits during more challenging market conditions typically renewed with limits as expiring.Some clients used savings on premiums to purchase additional limits to better align with

85、rising litigation costs,including defence costs and large settlements following insolvencies.Many claims notifications were related to wrongful acts or to investigations across various territories,particularly with environmental issues and injury claims.Clients with robust health,safety,and ESG proc

86、esses are more likely to gain favorable responses from insurers.Effective leadership and governance where clients operate continue to be key,and face-to-face meetings with insurers are beneficial to present risks directly to underwriters.Mining market update 202413The challenging market conditions f

87、or political violence risks over the last two years have seen some moderation of rates.Significant insured losses from the South Africa riots in 2021 and the onset of the Russia-Ukraine conflict led to increased global rates and prompted many insurers to reduce their appetites for mining risks.While

88、 conflicts continued,the past 12 months have not seen significant insured losses and rates started to decrease as insurer appetite rebounded.Additionally,several new insurers entered the market,adding capacity and increasing competition.Mining companies that have experienced recent losses or operate

89、 in conflict-affected countries remained among the most challenging for underwriters.Coverage typically only extended to physical damage,excluding BI or contractors plant and equipment(CPE)coverage.However,insurers have started to reintroduce BI and CPE coverage options.Underwriters generally looked

90、 beyond the physical security of insured assets to understand the dynamics of relationships with employees and local communities.Clients that demonstrated constructive engagement and responsible crisis mitigation strategies were encouraged to provide underwriters with a clearer understanding of the

91、risk.Strikes,riots,and civil commotion marketMining market update 202414Specie marketIn general,the global specie market,which includes insurance for precious and semi-precious items,has remained stable with no significant claims and ample capacity for static and transit risks related to valuable it

92、ems.Over the past 12 months,insurer appetite for mining risks in the specie market was strong,with estimated capacity reaching up to US$3 billion for any single tower.This capacity covered primary and excess static and transit risks worldwide.The rate environment has led to ongoing competition among

93、 the specie,property,and cargo markets for insuring mining risks.Specie policies continued to be written with little or no deductibles.In response to heightened political violence,insurers made wording changes regarding exclusions for Russian,Ukrainian,and Belarusian exposures in their reinsurance t

94、reaties.Due to commodity price fluctuations,there was a trend toward purchasing lower limits.However,the surplus of capacity in the specie market allowed for increased limits if needed,and further rate reductions may be possible.Coverage in the specie market is likely to remain broad,with rate reduc

95、tions available for competitively priced accounts,barring unforeseen changes in conditions.Clients should assess their mining output exposure to identify any specie risks.Those with specie exposure are encouraged to seek competing quotes to aim to take advantage of improved deductibles,comprehensive

96、 terms,and competitive pricing.Mining market update 202415Cyber marketOver the past year,cyber insurance market rates for the mining sector generally decreased.This was partly attributable to aggressive premium growth targets set by insurers and new capacity that increased competition.This competiti

97、on prompted several insurers to expand into the mining sector,which has traditionally faced capacity challenges.Some insurers broadened their products to include cyber physical damage and BI coverage.Overall,the cyber market for mining risks experienced lower loss levels than other industry segments

98、,boosting underwriter appetite.Heavy industry insurers provided more capacity for these coverages than ever,and an additional US$100 million of capacity entered the market through consortiums and additional insurers offering open market capacity.While there were fewer cyber claim notifications in th

99、e first half of 2024 compared to the same period in 2023,claims increased following the Microsoft Azure and Crowdstrike incidents.As cyberattacks become a more prevalent form of economic disruption and political risk factor,the mining industry crucial to the global supply chain has increasingly been

100、 targeted.There was heightened awareness around cyber physical damage,including state-based attacks on critical infrastructure.An emerging risk for mining organizations was cybersecurity around generative AI,which can enhance attackers capabilities.Primary cyber insurers differentiated themselves by

101、 offering value-added services such as tabletop exercises,claims scenario workshops,and cyber maturity health checks.Overall,some clients used favorable market conditions to increase coverage limits and lower their retentions.Many mining companies sought non-IT critical supplier coverage,which was h

102、arder to obtain in a challenging market.The pace of rate decreases may begin to slow as the market stabilizes,and insurers are likely to prioritize operational resilience and the separation of IT and operational technology(OT)environments when assessing mining risks.Nonetheless,businesses with a rob

103、ust cyber posture are likely to continue to see favorable coverage options.Mining market update 202416The collision in March 2024 between the containership Dali and the Francis Scott Key Bridge in Baltimore resulted in the tragic deaths of six individuals and could lead to one of the largest marine

104、insurance losses in the history of the London marine market.Preliminary estimates suggest the final loss could reach up to US$4 billion.While there was minimal direct loss to the cargo,general average(GA)has been declared.Since marine lines share a reinsurance program(including cargo),this incident

105、may impact cargo insurers reinsurance costs.Ongoing conflicts around the world have led to some contractual restrictions or rate penalties for certain areas.Cargo insurers are focused on supporting risks with established loss control,and reductions may be possible if loss records are satisfactory to

106、 underwriters.Cargo marketAt the start of 2024,the cargo sector experienced several losses,primarily due to adverse weather conditions.Despite this,the overall cargo market remained competitive,building on the positive momentum of previous years.Similarly,the market for cargo mining risks was also r

107、obust,offering meaningful capacity and aggressive terms.Mining market update 202417Construction marketDespite the entry of new insurers in the London market,terms and pricing in the construction market remained relatively stable over the past year.Deductible levels continued to reflect project size

108、and exposure,marking a shift from previous market conditions where deductibles were lower and claim volumes were higher.London insurers are likely to continue pricing that reflects their views of the exposures and does not necessarily account for how insurers in other markets are approaching risks.T

109、his approach may potentially lead to differential placements.Underwriters continued to scrutinize Nat Cat exposures and apply percentage of loss or value at time on risk(VARTOL)deductibles set at high minimums and no maximums.As insurers increasingly focused on ESG factors in their underwriting proc

110、esses,they often request additional information to satisfy internal corporate governance requirements.Reclamation bond marketUnderwriting appetite and capacity for reclamation bonds remained strong,despite evolving ESG metrics.However,surety capacity for coal remained restricted worldwide due to low

111、 ESG ratings.In general,the reclamation and rehabilitation of mine sites has historically proven to be lower-risk for mining companies,with limited loss activity among well-established companies.The pricing of surety bonds,which is influenced by a companys credit quality and the asset requiring the

112、bond,remained stable,and no pricing increases are expected in the near term.There is capacity available for larger,well-established,and financially stable mining companies with excellent operational records,solid safety and compliance records,and good relationships with federal and state authorities

113、.Surety costs have increased due to inflationary pressures on amounts for closure bonds for the mining of most natural resources.Pricing for coal-related projects stabilized despite the limited number of underwriters willing to provide support.Mining market update 202418Political risk marketSince mi

114、d-2023,the mining industry has experienced more than a dozen political risk events on five different continents(Figure 1).These events,which ranged from license cancellations to physical disruptions,highlighted the variety of political risks the sector must manage in a world of more regular conflict

115、 and government intervention.Mining projects often represent important sources of foreign investment,foreign exchange,and tax revenue.As such,they are particularly vulnerable to changes in government policy,including expropriation,license cancellation,and contract repudiation.Further,many government

116、s are attempting to manage high debt-to-GDP ratios amid low growth.Strong demand for the metals and minerals necessary to support the worlds growing energy needs and transition to a lower-carbon future present potential opportunities for governments to increase revenues by renegotiating their shares

117、 of growing sector profits.As the frequency and severity of political risk events increases,political risk insurance(PRI)can provide valuable support to clients.Generally,insurers took a positive yet pragmatic approach to new opportunities.Even with existing portfolios,there is a growing preference

118、to structure PRI policies around three or four core countries,rather than the traditional multi-country portfolio approach previously favored by insurers.Mining market update 202419Figure 01|Mining political risk events Source:Publicly available informationCanada,July 2023Following the launch of a l

119、awsuit,First Nation indigenous communities marched in Toronto to protest Ontarios decision to permit mining in their region,allegedly without consultation or regard for their sovereignty.Mexico,August 2023The Mexican government cancelled nine lithium mining concessions held by an international minin

120、g firm,though Mexicos mining chamber later disputed the governments right to do so.Panama,December 2023The government ordered the closure of one of the largest global copper mines following a court decision and long-running public protests.As of July 2024,that decision is under review.Ecuador,March

121、2024Violent clashes erupted between Ecuadorian security forces and protestors who were rallying against the revival of a stalled mining project,given its alleged threat to the environment.Australia,July 2024Australia blocked a request for mining lease renewal due to opposition from the indigenous co

122、mmunity and plans to incorporate the site into the Kakadu National Park.Indonesia,July 2024Indonesia minimized Chinese ownership of nickel projects so its domestic industry can qualify for tax breaks under the US Inflation Reduction Act.Malaysia,September 2023Malaysia joined other countries banning

123、the export of rare earth raw materials to boost domestic manufacturing of high-demand minerals.Mongolia,April 2024Mongolian lawmakers approved legislation allowing the government to seize shares in mining companies without compensating their owners and capping a single investors shareholding in a mi

124、ning company to 34%,down from 66%.Central African Republic,June 2024The government suspended the operations of a Chinese mining company for allegedly collaborating with rebel groups.Nigeria,March 2024Seeking to increase its revenues from its extractive sector,the government of Nigeria declared that

125、new mining licenses will only be granted to companies that process minerals locally.Burkina Faso,March 2024An escalation in terrorism forced several mines in the country to shut,leading gold output to decrease 1.5%year-on-year.Guinea,August 2023Guineas ministry of mining issued a demand for all mini

126、ng companies in the country to repatriate 50%+of revenues.Mali,August 2023Malis interim president approved a revised mining code which increased state ownership in the sector to raise the governments share of production revenues.Strikes,riots,civil commotion Terrorism War and civil war Security envi

127、ronment Economic risk Currency inconvertibility and transfer risk Sovereign credit riskTrading environment Expropriation Contractual agreement repudiation Legal and regulatory riskInvestment environmentMining market update 202420Summary:Client considerationsA comprehensive insurance strategy for a m

128、ining company considers the following aspects:Valuations:Clients should plan to proactively address valuation methodologies and provide details on their valuations.A more passive approach can result in insurers inclusion of coinsurance clauses and/or margin clauses.Updating your insurance program co

129、verage:Clients should review their property,natural catastrophe,business interruption,environmental,and related coverages to assess insurance protection.Claims processes:Clients should review their claims protocols,such as having a nominated loss adjuster,which can be invaluable when dealing with ma

130、jor and complex losses,especially regarding the BI component.We encourage clients to engage in pre-loss discussions with our in-house Claims Solutions team.Business interruption:A commodity price cap or a BI volatility clause may be proposed by insurers to seek to manage its exposure to commodity pr

131、ice fluctuations.A transparent approach to BI calculations,including the commodity prices used,can assist clients in resisting these efforts by insurers.Full assessment of risk:High quality and detailed underwriting submissions are promote an underwriters full assessment of risk and more timely resp

132、onses.Engineering reports:Insurers require engineering reports under two years old,tailings dam reviews,commentary on structural integrity,and demonstration of progress to risk recommendations.Conveyors(inspection,maintenance,housekeeping)and critical equipment and sparing(mill gears,large motors)ar

133、e receiving additional attention.Mining market update 202421MINESIGHT Marshs mining benchmarking tool,MineSight,launched in 2022,uses innovative placement data and pricing analytics tools so companies can better understand their risks and make informed insurance buying decisions with greater sophist

134、ication.We place risks for almost every base and precious metal or mineral for almost 120+mining clients from around the world,ranging from small,single-site operations to some of the worlds leading multinational corporations.This gives us valuable insight into the coverage and pricing available to

135、the global mining industry from the international insurance market.MineSight captures more than 100 data points,including historical and current market trends,premiums,retentions,exposure,and limits.MineSight allows us to deliver benchmarking reports that give clients the information to better asses

136、s the insurance coverage options that are the best fit for their business.To find out more,visit or contact your usual Marsh broker.CAPTIVES Mining,metals,and minerals represent a key industry of Marsh-managed captives globally,totaling US$624 million in premium.The top domiciles are Vermont,Singapo

137、re,Sweden,and Australia,followed by Bermuda,Barbados,and Dubai.The top captives owners are from Australia,Canada and the US.The number one coverage is property,from a wide range of risks and perils affecting physical assets business interruption.The other top coverages include general liability,thir

138、d-party risks,high excess coverages,supply chain,employee benefits,environmental,and marine/cargo.Emerging opportunities exist for climate change-related risks,such as lack of access to water for mining operations,weather events,and natural catastrophes.To learn more about captive insurance,visit or

139、 contact your local Marsh representative.SENTRISKCreated through the combined capabilities of Marsh McLennan businesses Marsh and Oliver Wyman,Sentrisk uses advanced technologies such as supply chain mapping AI and geospatial satellite imaging to enable organizations to map their supply chains more

140、comprehensively than ever before and develop risk mitigation,transfer,and management strategies that more closely align to their business needs.To learn more about Sentrisk,and how it can help empower companies to take control of their supply chain risk.visit market update 202422INDUSTRY SPECIFIC FA

141、CILITIESWe are continually identifying new ways of effectively delivering capacity and are committed to delivering innovative and sustainable placement solutions to Marsh mining clients worldwide.We offer specially negotiated facilities that facilitate an efficient quotation and placement of risks.7

142、50MUS$The impact of terrorism and political violence events can cause clients to have difficulties buying sufficient limits at economic prices in exposed territories.Our terrorism and political violence facility enables speedier quotation,risk transfer solutions,and reduced premiums.The facility off

143、ers up to US$750 million per insured using superior A+rated security.Terrorism and political violence facility 60MUS$Property risks span a wide spectrum,from building damage caused by a fire or flood to natural catastrophes and disruptions in the supply chain.Our property facility offers up to US$60

144、 million per insured using superior A+rated security.Property quota share facility Security risks are rapidly evolving,and crisis incidents can happen anywhere and anytime.Our special risks(kidnap and ransom)facility provides access to experienced response consultants,broad coverage,and swift quote/

145、bind documentation.The facility offers up to US$50 million per insured using superior A+rated security.50MUS$Special risks facility(kidnap and ransom)Detailed information on the above facilities is available from your usual Bowring Marsh contact or from .Mining market update 202423ContactsChristophe

146、r Partridge Global Head of Mining and Metals+44(0)7585 842 International Mining Placement Toby Van Der Venne+61 3 960 AUSTRALIA Cecilia Gutierrez+34 914 569 393 MADRID Amanda Szakmary+1 441 298 6653 BERMUDA Eric Zhu+86 21 6095 5789 SHANGHAI Samuel Andiappan+971(56)DUBAI Lynn Ho+65 6922 8578 SINGAPOR

147、E William Steer-Matthews+44 758 5803 244 william.steer- LONDONNicholas Bailey+41 44 285 9329 ZRICH Marsh Mining Practice Leaders Toby Van Der Venne Australian Mining Leader+61 3 960 32164 AUSTRALIA Christopher Partridge Global Head of Mining and Metals+44(0)7585 842 EUROPE AND CIS Damian Zucchi+54 9

148、11 522 96624 ARGENTINA Anuj Singh+1 244 049 205 INDIAChristine Francis+65 6922 8223 ASIA Csar Kahatt+51 1 604 1371 PERU Felipe Gusman+55 31 99502-BRAZIL Neil Beaumont African Mining Leader+27 72 280 1172 SOUTH AFRICA Raul Munoz+1 236 335 1985 CANADA David Frankland+44(20)UKLuis Ferrada Lpez+56 996 1

149、94 CHILE David Reasons+1 312 213 3486 US Maria Correa+57 316 258 4761 COLOMBIA Marsh is a business of Marsh McLennan.This document and any recommendations,analysis,or advice provided by Marsh(collectively,the“Marsh Analysis”)are not intended to be taken as advice regarding any individual situation a

150、nd should not be relied upon as such.The information contained herein is based on sources we believe reliable,but we make no representation or warranty as to its accuracy.Marsh shall have no obligation to update the Marsh Analysis and shall have no liability to you or any other party arising out of

151、this publication or any matter contained herein.Any statements concerning actuarial,tax,accounting,or legal matters are based solely on our experience as insurance brokers and risk consultants and are not to be relied upon as actuarial,tax,accounting,or legal advice,for which you should consult your

152、 own professional advisors.Any modeling,analytics,or projections are subject to inherent uncertainty,and the Marsh Analysis could be materially affected if any underlying assumptions,conditions,information,or factors are inaccurate or incomplete or should change.Marsh makes no representation or warr

153、anty concerning the application of policy wording or the financial condition or solvency of insurers or reinsurers.Marsh makes no assurances regarding the availability,cost,or terms of insurance coverage.Although Marsh may provide advice and recommendations,all decisions regarding the amount,type or

154、 terms of coverage are the ultimate responsibility of the insurance purchaser,who must decide on the specific coverage that is appropriate to its particular circumstances and financial position.1166 Avenue of the Americas,New York 10036.Copyright 2024.24-383237About MarshMarsh is the worlds leading

155、insurance broker and risk advisor.With more than 45,000 colleagues advising clients in over 130 countries,Marsh serves commercial and individual clients with data-driven risk solutions and advisory services.Marsh is a business of Marsh McLennan(NYSE:MMC),the worlds leading professional services firm

156、 in the areas of risk,strategy and people.With annual revenue$23 billion,Marsh McLennan helps clients navigate an increasingly dynamic and complex environment through four market-leading businesses:Marsh,Guy Carpenter,Mercer and Oliver Wyman.For more information,visit ,and follow us on LinkedIn and X.