Queensland rural group AgForce is concerned farmers with coal seam gas (CSG) infrastructure on their properties will struggle to obtain liability insurance after WFI said it will no longer provide the cover in those circumstances.

“With thousands of producers across the nation having to renew their insurance in a few weeks, this is a massive problem that needs an urgent resolution,” AgForce CEO Michael Guerin said.

“This not only affects producers who currently have CSG infrastructure on their properties, a situation which is basically mandated and not voluntary, but the many on whose [properties] gas exploration is going on for future development.”

IAG says it has recently updated its WFI farm insurance policies to no long provide liability cover to farms that have operational unconventional gas activities or infrastructure.

For existing customers, the change will take place at renewal, but they will still be covered for other sections of their policy, such as the farmhouse, machinery, equipment and their vehicles.

“We have made this change because we do not specialise in underwriting resources and mining operations and activities,” a spokesman told insuranceNEWS.com.au.

As a result, an understanding of how these activities and related infrastructure may impact a customer’s overall level of risk and liability has not been calculated as part of their policy or premium, he says.

The change brings WFI into line with IAG’s CGU brand, which has not provided farm liability cover for CSG and shale gas activities on farms for several years.

In the conventional coal sector, brokers say it is increasingly difficult to secure cover from insurers for production and supply-chain activities, and underwriters seeking to improve profitability are taking a tough line on any type of complex risk.

“An increasing number of insurance carriers are not only reluctant to continue their support of the coal producers themselves but are also withdrawing their underwriting capacity through the entire supply chain,” CRE Insurance Broking MD David Harrison tells insuranceNEWS.com.au.

Broking Director Adam Battista says the firm is in constant communication with clients as they are “hugely affected” by the shifting risk appetites of the insurance market and drastic program changes.

“It’s difficult to prepare them entirely for the changes they face year to year as it varies from pricing, program structures, self-insured retentions, where it’s placed or, most recently a combination of these,” he said.