The energy & mining sector is subject to a wide array of risks, including environmental liabilities, regulatory changes, & operational hazards.
Companies in this field might form a captive for three main reasons:
To gain coverage for difficult-to-insure risks.
To better manage the financial volatility associated with large-scale industrial accidents or environmental events, and
To capitalize on the potential for cost savings and cash flow improvements through self-insurance mechanisms.
SRS’s strategy for the energy and mining sector includes the development of captives that offer tailored insurance solutions, risk retention programs, and access to global reinsurance markets. Our services are designed to mitigate the sector’s unique challenges, offering comprehensive coverage that aligns with the company’s risk appetite and financial goals.
Energy and mining companies working with SRS can expect to see a direct impact on their bottom line, with reduced insurance costs and a more efficient allocation of capital. Key indicators of success can include a decrease in Total Cost of Risk (TCOR) and enhanced risk management metrics. As the sector continues to evolve amid shifting regulatory landscapes (and the widespread transition to renewable energy sources), SRS’s captive solutions are poised to provide a stable foundation for risk management and financial performance in 2025 and beyond.
Energy & mining companies form captives in order to gain:
Risk Control: Captives provide greater control over risk management, allowing energy and mining companies to tailor insurance coverage to specific industry needs.
Cost Efficiency: By assuming a portion of the risk and retaining underwriting profits, captives can lead to long-term cost savings.
Financial Stability: Captives allow organizations to build financial reserves and stabilize their insurance costs.
Captive insurance empowers energy and mining companies to manage risks effectively, reduce costs, and enhance financial stability. It’s a strategic tool that aligns insurance coverage with unique sector requirements as well as individual business objectives.
Energy & Mining Practice Group FAQs
Why are captives particularly suited for the energy and mining sector?
Due to the high-stakes nature of the industry, captives offer energy and mining companies the flexibility to cover unique operational risks––such as environmental liabilities and equipment failure––that may otherwise be underserved by traditional insurers.
Can captives insure against regulatory and political risks in different countries?
Yes, captives can be designed to provide coverage for regulatory changes, political unrest, and nationalization risks, which are especially important for energy and mining operations across multiple jurisdictions.
How does SRS facilitate the creation of a captive for energy and mining firms?
SRS offers expertise in regulatory compliance, risk assessment, and insurance program design––all tailored to the complex needs of the energy and mining industry. This helps ensure energy and mining captive clients can meet both their financial and operational objectives.
What are the benefits of managing environmental liabilities through a captive?
Captives allow for the creation of dedicated reserves for environmental liabilities, securing funds for remediation and regulatory fines while simultaneously offering potential cost savings over traditional insurance.
How can captives impact the overall risk management strategy of an energy or mining company?
Beyond financial benefits, captives can drive improvements in safety and environmental practices by aligning insurance costs with risk management performance, encouraging better overall risk mitigation strategies.
SRS Energy & Mining Practice Group Stats
30+ Energy & Mining Captives
15 Active Domiciles
International:
Barbados
Bermuda
British Columbia
Guernsey
Netherlands
Switzerland
United States:
Arizona
Georgia
Missouri
North Carolina
South Carolina
Tennessee
Texas
Utah
Vermont
SRS owns or partially owns several different sponsored cell facilities across the globe with the aim of offering cell vehicles to the energy and mining industry.
Insurance Programs We Manage
Auto Liability
Auto Physical Damage
Completed Operations
Employers Liability
General Liability
Home Warranty
Medical Stop Loss
OCIPs/CCIPs
Professional Liability
Structural Defect
Subguard
Workers' Compensation
About Strategic Risk Solutions
SRS is the world’s largest independent insurance company manager. With over 25 years’ experience, SRS provides management and consulting services to a wide range of insurance company structures, from single-parent captives to complex commercial insurers and reinsurers. SRS has operations in North America, South America, Europe, Barbados, Bermuda, Canada, Cayman Islands, and South Africa.
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