Soft market conditions prevail for the mining property insurance market on account of excess capacity and a lack of significant property claims.
It is questionable whether even some major losses will change the status quo. There are, however, examples of technical markets declining participation in certain property renewal placements on account of a perceived mismatch between pricing and risk.
This trend has led to brokers utilising greater levels of capacity from non-proportional markets, including Syndicates at Lloyd’s, for primary and excess of loss layers to make up for drop offs in capacity from technical markets, secure more generous sub-limits and drive price outcomes.
Whilst generating competition remains a key consideration, clients must still ensure that their brokers are selecting the most suitable market partners for their profile, and only consider utilising new markets with an open mind to their potentially opportunist play in this space.
On account of the cyclical nature of the property insurance market, Lloyd’s Syndicates, technical and general insurers will dominate placements during different phases but technical insurers tend to be the most consistent in the long term and when faced with an increase in claims frequency.
Whilst we are currently in the midst of a downturn, some commodity prices will likely rise in the medium term so it is likely we will see limits going up, and as a result, premium pools may also begin to rise. At present, the mining property insurance market is a buyer’s market where a strong broker can achieve both pricing and coverage enhancements on behalf of their clients.
JLT Mining's Performance
Tip for buyers
A balanced approach underpinned by engagement with technical markets with a tried and tested reputation for strong claims management should always be considered.
For further information, please contact Harry Floyd, Partner, JLT Mining on +44 207 466 1305 or email email@example.com