Life insurance and income protection insurance for the Mining Industry is often thought of as too risky and difficult to obtain the required cover for the various occupations within the industry.
Australian Life insurance providers may have declined cover for the mining industry in the past, despite the fact that in 1994, a study into the mining and drilling industries accident records revealed, “that underground (hard rock) mining actually had a marginally better accident and safety record than many other occupations, including the Railway and Building industries.” Quote sourced from Mining Insurances Queensland.
Though nowadays most insurers will provide cover for mining occupations but may offer less or restricted contracts at increased premium levels or with an additional loading.
With news reports of mining disasters in Beaconsfield, Tasmania, New Zealand’s Pike River and Chile, insurance providers are naturally reluctant to include “high risk” mining occupations.
A comprehensive risk insurance package is available depending on the type of work you perform in the mining industry. For example, a Geologist that carries out office work only is eligible to receive comprehensive insurance that includes: Life, TPD & Trauma at standard rates as well as Income Protection to age 65.
On the other hand, a Geologist that performs some field work or field work only is eligible to receive Life; Trauma & Income Protection to age 65 at standard rates but TPD has a loading.
Insurance cover for mining work will vary according to the risks involved. Depending on the type of work performed i.e. on the surface, underground and whether explosives and other machinery are involved will determine the level of risk and the type of cover you can expect.
For instance, mining work undertaken aboveground only, without explosives, you can expect to be covered for Life & Trauma at standard rates and TPD is available with a loading, while Income Protection will vary from insurer to insurer with benefit limits from 2 to 5 years.
For mining work performed underground and/or with explosives, insurers will generally provide cover for Life & Trauma with a loading while TPD and Income Protection is generally not available or only under individual consideration or under limited terms. Again this will vary from insurer to insurer.
While TPD may not be available for certain mining occupations, a trauma policy without a premium loading should still provide valuable cover. The trauma cover should provide a benefit for a variety of medical conditions including loss of limbs and paralysis, which may occur as a result of a workplace accident.
When determining the most appropriate policy, life insurance companies will consider the following criteria when assessing applications for cover:
• The terms of the cover available and the affordability (e.g. 5 years, to age 65, non occupational)
• The features and benefits of the product being offered (e.g. definition of disability, pre disability earnings)
• Offsets and exclusions (sporting and recreational pastimes, claims reduction clauses, criminal activity exclusions, offsets for workers compensation)
• Loss of Independence (LOI) definition as an alternative to TPD
As with most Life insurance it’s always wise to seek the services of a financial planner or insurance broker that understands this specialist insurance category. It can make a huge difference between getting the right cover with acceptable premium costs or being lumped with an insurance plan that doesn’t offer realistic cover to protect mining professionals against the dangers and risks associated within their industry.