“ESG has now moved to the centre of the underwiring process,” said Ana Pedrouzo, a senior property underwriter at Mapfre Global Risks. “Many, or probably most, companies now have a tool that gives us an ESG rating, and we will not write the risk if the rating is not good enough.”
Leading European insurer Mapfre said on the opening day of the Ferma Forum that it will not sell insurance to mining companies if their ESG actions are not up to scratch. What is more, the company wants concrete proof that mining clients are doing what it takes to improve their sustainability credentials.
“ESG has now moved to the centre of the underwiring process,” said Ana Pedrouzo, a senior property underwriter at Mapfre Global Risks. “Many, or probably most, companies now have a tool that gives us an ESG rating, and we will not write the risk if the rating is not good enough.”
Speaking during a panel on Latin American mining risks, Pedrouzos added that insurers aren’t the only financial sector keeping an eye on how sustainable miners’ operations are today. As a result, she believes the mining industry is moving in the right direction.
“We see that mining companies are really working on their ESG commitments, and not only for reputational purposes but also for getting insurance and financing,” said Pedrouzo. “They are working on diverse representation, on giving back to the local communities, on water management, on restoring land after losses and, obviously, on reducing their carbon footprint and emissions.”
The insurance industry’s emphasis on ESG comes at a moment when the mining industry faces significant challenges to address its insurance needs. One of them is the sheer cost of their covers, according to leaders of Latin American companies who participated in the panel debate.
“Prices of insurance are getting too high,” said Juan Carlos Miljanovich, the CFO at Summa Gold Corporation, a Peruvian gold producer.
Guilio Valz-Gen, the CEO of Howden Peru, noted that getting favourable insurance covers for mining operations requires the involvement of business leaders....
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