The 2019 mining disaster in Brazil is expected to lead to a double-digit jump in costs to insure U.S. tailings dams that store mining waste against liability for environmental catastrophes.
Tailings dams, some of which tower dozens of meters high and stretch for several kilometers (miles), are the most common waste-disposal method for mining companies, whether they extract iron ore, gold or copper.
The deadly collapse last January of the dam at Vale SA’s Corrego do Feijao iron ore mine in Brumadinho rocked the mining industry and spurred calls for massive operational changes. At least 259 people were killed here in the incident.
Following the disaster, miners in the United States can now expect to pay 10% to 20% more to secure environmental and pollution coverage for tailings dams when policies come up for renewal, and securing that coverage has become more challenging, insurance broker Willis Towers Watson (Willis) said.
That cost rise was expected, and mining companies are set to fork out more for property and liability insurance as fewer insurers are willing to cover the riskiest aspects of the mining business.