For the global mining sector, tailing dam failures are a stark reminder of a changing corporate reality. A tailings storage facility failure is a multi-line crisis that breaches physical boundaries, erodes community trust, and incurs staggering property, business interruption, and liability losses. In an era of heightened transparency, these failures can quickly capture international attention, leaving corporate boards to face severe reputational and legal fallout.
As a result, the global insurance market is fundamentally changing how it evaluates mining risks. Underwriters are looking beyond basic regulatory compliance, moving into deep engineering analyses to separate resilient operations from high-risk liabilities.
At Aviva Risk Management Solutions (ARMS), we work collaboratively with mining companies to evaluate these exposures. By understanding how insurers assess risks, you can prioritize the right safety investments, protect your community, and improve your risk profile.
Here are some of the risk prioritization frameworks that insurers use to evaluate mining facilities.
Understanding the casualty underwriting framework
When evaluating a mining operation for casualty and liability insurance, underwriters categorize tailings storage facilities into distinct risk tiers.
The framework generally ranks exposures from lowest to highest risk:
- Dry stack tailings or no tailings: Representing the lowest risk profile due to the elimination of large volume fluid containment.
- Conventional tailings with strong controls: Wet or slurry systems that use robust engineering designs and continuous oversight.
- Transitioning to dry stack/filtered: Active projects moving away from wet storage methods to reduce long-term liability.
- High-consequence wet tailings (upstream dams): Classified as high-risk due to the historical susceptibility of upstream dam construction to sudden failure or liquefaction.
Positive indicators versus red flags
To help you evaluate your mining facility through an insurance lens, measure it against our ARMS model. This comparison highlights the structural, operational, and organizational elements that risk consultants look for, alongside the corresponding red flags that indicate elevated risk exposure.
| What insurers look for (green flag) | What insurers avoid (red flag) |
| Full compliance with the Global Industry Standard on Tailings Management (GISTM) or recognized national equivalents, e.g. CDA, MAC. | No adherence to recognized international or regional tailings safety standards. |
| Dry stack or filtered tailings actively in use to minimize fluid-related stability hazards. | Continued reliance on upstream dam construction methods for fluid tailings. |
| Downstream or centreline dam construction designs for conventional wet tailings. | Tailings storage facilities located in high-risk zones, including high seismic areas, floodplains, or degrading permafrost. |
| Regular, independent third-party technical reviews and safety audits. | A complete lack of third-party verification or reliance on outdated risk assessments. |
| Real-time monitoring systems, such as piezometers, LiDAR, satellite-based InSAR, or ground-deformation modeling. | Absent or fragmented monitoring, or an unknown current structural dam status. |
| A comprehensive, regularly tested Emergency Response Plan (ERP) integrated with local communities. | No formalized ERP, or outdated emergency and community notification procedures. |
| Fully funded, clearly documented closure and reclamation plans backed by financial assurance. | Ongoing regulatory infractions, outstanding compliance issues, or unresolved past environmental incidents. |
| Transparent ESG reporting combined with direct, board-level oversight of tailings safety. | Poor environmental transparency, weak corporate governance, and strained community relations. |
Actionable strategies to mitigate tailings risk
Securing operational resilience requires translating these underwriting insights into on-site risk management practices. Our ARMS specialists recommend focusing on two core areas:
- Upgrade monitoring technology: Moving beyond manual inspections is essential. Integrating real-time piezometer data with satellite-based InSAR can flag millimeter-scale ground deformations weeks before a visible failure occurs, providing an invaluable early-warning timel
- Strengthen governance and auditing: Ensure that your tailings management framework reports directly to executive leadership or the board of directors. Appointing an Independent Technical Review Board (ITRB) ensures that safety metrics are validated outside of daily operational pressures.
Partner with ARMS for long-term resilience
Our risk consultants across Canada are equipped to help you review your current tailings protocols, benchmark your operations against the GISTM, and strengthen your loss prevention strategies.
To learn more about how we can support your operations, reach out to our team at arms.canada@aviva.com.
