Western Australia’s resources sector is one of the most demanding and highly regulated industries in the world. Mining contractors—whether working in shutdowns, electrical services, maintenance, civil construction, labour hire or site support—face daily risks that most businesses never encounter. For SME operators with fewer than 50 employees, managing these risks is essential not only for compliance, but for the long-term survival and profitability of the business.
Good insurance is a crucial part of that equation. But strong protection requires more than simply purchasing a policy. It demands a clear understanding of the risks you take on, the obligations hidden within contracts, and the expectations insurers have when assessing high-risk mining work.
This guide outlines the core areas SME mining contractors in WA must understand—contractual liability, insurer disclosure, workforce management, public liability, workers’ compensation, and the role of a professional broker. The aim is to provide practical, plain-English guidance you can apply immediately, while strengthening your ability to secure favourable insurance terms.
Contractual Liability: The Silent Risk That Can Sink an Unprepared Contractor
Many SME mining contractors underestimate the risk hidden within the contracts they sign. Whether engaging with Tier 1 miners, large engineering houses or labour-hire arrangements, the contractual obligations imposed on contractors can be significantly broader than typical legal liability.
Common problem areas include:
- Indemnity clauses that make you responsible for losses caused by other parties
- “Hold harmless” agreements that prevent you from recovering damages
- Assumption of liability beyond what is legally required
- Insurance obligations that cannot be met with standard policies
- Requirements to “make good” damage even when you are not negligent
These clauses often appear harmless but can shift enormous responsibility onto the contractor.
Why working with a good lawyer is essential
A strong commercial or construction lawyer understands how mining contracts are structured and can pinpoint clauses that could leave you uninsured or financially exposed. They can:
- Interpret contract language and explain risks
- Identify obligations insurers must be told about
- Recommend amendments before signing
- Support negotiations with a more balanced risk position
- Reduce the likelihood of disputes or uninsured losses
For an SME mining contractor, this can be the difference between surviving a major incident or facing severe financial strain.
How insurance interacts with your contracts
Not all contractual obligations are insurable. If your policy does not cover the liability you have agreed to accept, you may face a gap that becomes apparent only when a claim occurs. This is why insurers need to understand the contracts you operate under—and why your broker must advocate strongly on your behalf.
Helping Insurers Understand Your Actual Risk Profile
Mining work is inherently high-risk, but not all contractors operate the same way. Insurers require accurate, detailed information to assess the work you perform, the sites you work on, and the controls you have in place. When contractors fail to provide adequate detail—or when work changes without being disclosed—it can cause real problems at claim time.
Why transparency with insurers matters
Insurers typically want to understand:
- The exact nature of the work carried out
- Whether the work involves high-risk activities (e.g. hot works, working at heights, confined spaces, underground areas, shutdowns, electrical testing, mobile plant interaction)
- Your safety management systems
- Workforce structure (employees vs contractors)
- Subcontracting arrangements
- Training, competency and supervision levels
- Any host-employer arrangements
What happens when this goes “under the radar”
When insurers receive vague or incomplete information, several issues may arise:
- Premiums may be incorrectly priced
- Policies may include exclusions that affect real-world operations
- Claims may be subject to additional scrutiny
- In serious cases, claims may be declined due to non-disclosure
For SME mining contractors, ensuring that insurers properly understand your risk helps improve market appetite, supports more competitive premiums and avoids surprises at claim time.
Delmont Insurance Group specialises in preparing detailed risk submissions that give underwriters the clarity they need, helping ensure you receive appropriate coverage for the actual work you perform.
Strengthening Employment Management: A Key Driver of Insurance Performance
Contractors in the mining industry rely heavily on their workforce, and insurers increasingly scrutinise how well employment is managed. From onboarding to offboarding, your processes significantly influence workers’ compensation outcomes and your overall risk profile.
Onboarding processes that reduce risk
Effective onboarding sets expectations and ensures workers are fit and competent. Strong onboarding may include:
- Pre-employment medicals (PEM)
- Verification of competency (VOC)
- Licence checks
- Drug and alcohol testing
- Clear explanation of safety processes
- Induction into your internal safety policies
- Host-employer expectations and site-specific training
During employment: consistent controls
Once workers are on site, insurers value contractors who maintain:
- Documented training and refresher courses
- Toolbox meetings
- Safety observations and behavioural programs
- Effective fatigue management
- A strong reporting culture
- Clear documentation around incidents and near misses
Return-to-work management
A well-designed return-to-work program supports faster recovery and reduces claim costs. It includes:
- Early contact with the injured worker
- Collaboration with medical providers
- Clear duties lists
- Communication with host employers
- A structured plan to gradually increase capacity
Offboarding
Sound offboarding ensures documentation is finalised and any safety issues are captured. This protects the business from inaccurate employment records that may be referenced later in a claim.
Why this matters to insurers
Strong workforce management leads to:
- Fewer injuries
- Faster recovery times
- Transparent documentation
- Lower workers’ compensation premiums
- Better long-term claims performance
For SME mining contractors, these processes also strengthen relationships with host employers and improve competitive position at tender stage.
Why Working With a Skilled Insurance Broker Makes a Real Difference
Insurance in the mining sector is complex, and many SME contractors find it difficult to secure favourable terms without professional support. A skilled broker does far more than collect quotes—they act as your advocate, risk adviser and strategic partner.
What effective broking service should look like
A strong broker should:
- Understand your work in detail
- Identify the risks unique to your operations
- Review key contracts for insurance implications
- Prepare comprehensive underwriter submissions
- Negotiate improved terms, conditions and pricing
- Provide guidance on employment and safety management
- Support you through workers’ compensation claims
- Ensure timely renewal management
- Keep insurers informed as your business evolves
For Delmont Insurance Group, servicing SME mining contractors across Western Australia means acting not only as a broker but as an ongoing adviser—helping businesses build long-term resilience through better systems, better disclosures and better insurer engagement.
The Starting Point: Core Insurance Policies for Mining Contractors in WA
Before discussing specific policies, best practice for any mining contractor—particularly SMEs—is to sit down with an insurance broker who understands the Western Australian resources sector and build a full risk profile.
This involves mapping out:
- The work you perform
- The sites and environments you operate in
- Your contractual obligations
- Workforce structure and safety systems
- Subcontractor exposures
- Plant, equipment and high-risk tasks
- Any planned business growth or change in scope
A clear, accurate and well-documented risk profile ensures that insurers understand exactly what they are insuring. It also helps you avoid gaps that commonly arise in the mining and resources sector.
From there, the starting point for any WA mining contractor is to ensure the two most critical policies—Public Liability and Workers’ Compensation—are correctly structured and fully aligned with your risk profile.
Public Liability Insurance for Mining & Resources Work
Public liability insurance is essential for all mining contractors. However, general liability policies designed for standard trades or light commercial work are not suitable for high-risk mining environments. Your policy must be structured specifically for the mining and resources industry and reflect your true work activities.
A properly designed mining liability policy should address:
- Contractual liability
Coverage must align with the indemnities and obligations in your contracts. If these are broader than your policy, you may be exposed. - Property damage on site
Mining sites are high-value environments—damage to plant, equipment, conveyors, or processing infrastructure can easily become a large loss. - Interaction with mobile plant
Many incidents involve interaction with heavy machinery or mobile equipment; insurers must know this is part of your work. - Subcontractor arrangements
Policies must define whether subcontractors are included or excluded, and how liability is shared or passed through. - Hot works, welding and electrical exposure
These activities increase fire and operational risk and must be clearly declared. - Underground or high-risk activities
Any underground, confined space, hazardous area or shutdown work must be accurately disclosed, as they significantly influence insurer appetite.
Failing to tailor your public liability cover for mining operations can leave substantial gaps in protection—gaps that often only become visible in the event of a large claim. Starting with a clear risk profile ensures the policy correctly reflects your real exposures.
Workers’ Compensation Insurance (WA)
Workers’ compensation is mandatory for all employees in Western Australia and is typically one of the most significant insurance costs for mining contractors. The pricing, terms and future performance of your workers’ compensation insurance are heavily influenced by the systems you have in place.
Key factors include:
- Claims history
A strong record demonstrates good safety management and fewer disruptions. - Safety systems and training
Insurers look closely at competency verification, inductions, toolbox meetings and ongoing training. - Injury management and return-to-work processes
The faster and more supported the return-to-work process, the lower the long-term claim cost. - Employment documentation
Well-structured onboarding and offboarding processes show insurers you take workforce management seriously.
A structured risk profile helps ensure your workers’ compensation insurer receives a complete and accurate understanding of your workforce, safety processes and operational controls. This can directly improve pricing, terms and insurer engagement at renewal.
Better Processes. Better Contracts. Better Insurance.
Mining contractors in Western Australia navigate a complex environment where risk, compliance and operational pressure intersect. For SME operators, the right protection comes from a combination of strong contracts, disciplined workforce management, full insurer disclosure and the support of a professional insurance broker who understands the resources sector.
If you would like a review of your insurance programme or guidance on improving your risk profile, Delmont Insurance Group is here to support mining contractors across Western Australia.
Contact Delmont Insurance Group today on (08) 6184 8724 or via email at info@delmontinsurance.com.au.
Article written by James Wilson, Director of Delmont Insurance Group — a trusted adviser and specialist insurance broker