Article

A new approach to enhancing tailing dam safety and simplifying the insurer reporting process

To help address the pressing need for enhanced tailings dam safety, Marsh has developed the Tailings Dam Self-Assessment (TDSA), which helps mining companies simplify the assessment process.

Tailings facilities, the most common waste disposal method for mining companies, are integral to mining operations, irrespective of the method used or material mined. Ensuring that proper principles of safety and responsibility are maintained is critical for both the mining industry and insurers. With approximately 3,500 tailings dams worldwide, the potential for safety incidents is a cause for concern — four major tailings dam disasters occur each year, on average. And they are becoming more frequent and costly; since 1985, the costs incurred by six major disasters, including the 2022 Jagersfontein tailings dam disaster exceeded US$60 billion.

More than a third of all tailings dams are at high risk of causing catastrophic damage to local communities, economies, and ecosystems if they collapse. The most frequent causes of incidents are earthquakes, overflow, and landslides. Tailings aren't a predictable as a building material and are often waterlogged. The prevention and mitigation of tailings facility failures play an important role in minimising the possibility of an incident occurring.

Upstream tailings dams are the most vulnerable to collapse because the structure’s retaining wall is built into the tailings being stored, rather than on a firm foundation, which increases the potential for rupture. With the fourth-highest number of tailings dams globally (195), South Africa has a pressing need for proactive measures to ensure their safety. Globally, most high-risk dams are upstream, with the majority of these in South Africa (79). The country is not alone in experiencing dam failures or having dams of varying stability. For example, Tanzania and Ghana have experienced tailings dams failures in the past five years that have affected local communities and water availability.

Of South Africa’s 195 dams, only 52 are active at present. Active tailings dams are at higher risk of collapse because they grow in height as more tailings are stored behind them. However, many inactive/closed dams are also considered high-risk, highlighting the urgency for comprehensive safety assessments and proactive measures to ensure the safety of tailings dams.

Mining companies must increasingly demonstrate that they follow global standards for tailings dam design and maintenance. To prevent the failure of tailings dams and implement best practices, most members of the International Council on Mining and Metals are committed to implementing its Global Industry Standard on Tailings Management (the Standard).

South Africa's government and mining companies operating in the country are currently updating the country's tailings code to align with the global standard. This could help provide clearer rules for managing tailings and encourage others to follow.

The insurance industry has also revisited its approach to the safety of tailings dams, given several major losses in recent years. Much of this renewed focus requires more accurate evaluations and assessments of the risks that can potentially lead to a tailings dam failure. This can be difficult as key risk indicators are challenging to assess. For instance, many tailings dams are more than thirty years old, with risks lying deep in the foundations of each structure, making it hard to accurately establish the current conditions or how they may perform over time.

To help address the pressing need for enhanced tailings dam safety, Marsh has developed the Tailings Dam Self-Assessment (TDSA), which helps mining companies simplify the assessment process. After the tool is used to assess each risk, a report is produced to help insurers determine the safety of the tailings dam and ensure each risk is insured commensurately.

The TDSA thoroughly evaluates various factors that can impact dam safety, including the age of the tailings dam, construction type (upstream or downstream), building materials, and the expected service life and operational output. Other factors assessed include the dam’s monitoring systems, maintenance practices, and emergency preparedness. The tool identifies potential risks and vulnerabilities within the dam structure by analysing data and applying advanced algorithms. This delivers actionable intelligence to mining companies so they can implement targeted risk mitigation strategies.

Another benefit of the tool is gained through transparency, with companies able to share their information to help foster a culture of continuous improvement within the mining community. To date, a lack of accurate information and no credible database has meant that many tailings failures go unreported.

Detailed information is often required to fulfil tailings dam risk information requirements from an insurance perspective. The TDSA can provide insurers with comprehensive risk assessment reports, allowing mining companies to better manage their risks through optimal risk transfer and coverage.

Start your free assessment

Enhancing tailings dam safety and simplifying the insurer reporting process go hand in hand: Reliable and accurate data can help provide mining companies with access to improved cover, while also making it more attractive for insurers. Both factors play an important role in derisking tailings dams incidents.

Marsh has supported mining projects for decades and draws on this expertise to continue to work with the industry in its journey toward more responsible and sustainable operations.

Article

A new approach to enhancing tailing dam safety and simplifying the insurer reporting process

Risk assessment

Related insights

Geopolitics and geology: Enhancing mining companies’ resilience amid political risk uncertainty

How Sub-Saharan Africa mining companies can reduce risk and increase attractiveness to investors

Navigating shifting threats and emerging trends

Risks and opportunities in Sub-Saharan Africa for mining companies

Marsh.com Sign in

A new approach to enhancing tailing dam safety and simplifying the insurer reporting process

Risk assessment

Together, we can build a safer future for tailings dam management

Related insights

Geopolitics and geology: Enhancing mining companies’ resilience amid political risk uncertainty

How Sub-Saharan Africa mining companies can reduce risk and increase attractiveness to investors

Navigating shifting threats and emerging trends

Risks and opportunities in Sub-Saharan Africa for mining companies