BHP Marine & General Insurances Pty Ltd, the Australian captive of mining group BHP, ceased writing new policies on 1 July following a review of the group’s insurance arrangements, Fitch Ratings says as it affirms the captive’s ratings. The captive remains on cover for its existing guarantee bonds and for business written up to 30 June, including workers’ compensation and liability classes. It does not underwrite third-party business, and all of its premiums are sourced from BHP group entities. Fitch affirms the captive’s insurer financial strength rating and long-term issuer default rating at ‘A’, with a stable outlook. The agency equalises the insurer financial strength rating with BHP’s own long-term issuer default rating, also ‘A’ with a stable outlook, on the basis that it considers the captive a core captive of the group. That assessment reflects the integration between captive and group, the reliance of its business model on the group, and its strategic importance in providing insurance protection to BHP and its subsidiaries. The captive is domiciled in Australia and wholly owned by BHP. Fitch says the captive’s objective is to create and protect value by supporting BHP’s self-insurance strategy through cost effectiveness, and that it is not run as a profit centre. Operational integration is further demonstrated by the group’s representation on the captive’s board and risk management function. On capitalisation, the captive’s Fitch Prism Global score was ‘Extremely Strong’ in the financial year ended June 2025, as in the previous year. Coverage of the regulatory prescribed capital amount was 1.87 times at the end of that year, against 1.76 times a year earlier. The captive holds no direct investments. It lends all of its funds to BHP Billiton Finance, a group subsidiary, on an at-call basis. Fitch says a downward revision of its assessment of the captive’s core status could lead to negative rating action.
