Willis Towers Watson (NASDAQ: WLTW), a leading global advisory, broking and solutions company, today launched its Mining Risk Review 2019 which shows that although there are key uncertainties that need to be addressed in both the mining and insurance industries, global mining insurance did not yet constitute a truly hard market.
Releasing the Review, Graham Knight, Global Head of Natural Resources, Willis Towers Watson, commented: “Our 2019 Review is being published in the aftermath of yet another tailings dam tragedy. But from an insurance perspective, although rates are generally hardening as a result of tailings dam and other losses, this is still not yet a truly hard market. Capacity remains plentiful by historical standards and when rates are on an upward trend, we are by no means in a truly distressed situation.”
The Review also reveals four key uncertainties within the mining industry that need to be addressed:
· Digitisation: a combination of negative attitudes, increased cyber risk, a failure to train properly and upskill and the potential for the process to discard valuable human experience during the digitisation process suggests that miners are exposed to a number of new risks that can threaten project viability.
· Bottlenecks: too often, getting a mine back up and running after a major incident is dependent on factors outside the mine operator’s control; too often in the event of a major loss, the precise cause can often remain uncertain.
· Geopolitical risk: Increased tariffs, regulations, legislation and tax liabilities imposed between different countries have had a direct impact on the viability of mining projects in a variety of locations around the world – especially given the global nature of the industry’s supply chains.
· Social Economic Development: the relationship that miners form with local communities is always a fundamental factor to consider in developing an effective risk management strategy. Mining industry risk managers and their teams need to be looking to the deep relationships and activities that need to be built and developed for real and sustainable long-term progress.
A link to the report can be found here https://www.willistowerswatson.com/en-GB/Insights/2019/09/mining-risk-review-2019-addressing-uncertainty