The 2019 mining disaster in Brazil is expected to lead to a double-digit jump in costs to insure US tailings dams that store mining waste against liability for environmental catastrophes.

Tailings dams, some of which tower dozens of meters high and stretch for several kilometers, are the most common waste-disposal method for mining companies, whether they extract iron ore, gold or copper.

The deadly collapse last January of the dam at Vale's Corrego do Feijao iron-ore mine in Brumadinho rocked the mining industry and spurred calls for massive operational changes. At least 259 people were killed.

Following the disaster, miners in the United States can now expect to pay 10% to 20% more to secure environmental and pollution coverage for tailings dams when policies come up for renewal, and securing that coverage has become more challenging, insurance broker Willis Towers Watson (Willis) said.

That cost rise was expected, and mining companies are set to fork out more for property and liability insurance as fewer insurers are willing to cover the riskiest aspects of the mining business.

In an industry beset with tight margins, such cost hikes are not ideal.

The United States has the second-largest number of tailings dams built using an architectural method considered unsafe by many engineers, according to a Reuters analysis of industry data.

Insurers had already begun taking steps to curb their tailings dam exposure before the Vale disaster, in the wake of at least three major dam failures globally in the past six years.

"The market has become much more risk (averse) and scrutiny is increasing," said Andrew Wheeler, who heads the mining and natural resource practice at Willis.

Vale expects to pay about $8 billion (33.1 billion Brazilian reais) in total costs by 2031, including compensation for "material and moral damages" and efforts to clean and restore the region.

The Vale disaster has encouraged insurers to become sticklers over the wording of all types of mining policies, including property damage, business interruption and potential legal liabilities.

For example, if a policy covers $50 million for debris removal and $100 million for the loss of a tailings facility, insurers want to make it clear that a company cannot collect both amounts.

Last May, American International Group (AIG) said it would no longer write any pollution liability coverage for global mining and tailings risks, according to Willis.

An AIG spokesman declined to comment on the change, which followed AIG's earlier exit from writing US and Canadian pollution liability coverage.