Compared to traditional areas of actuarial practice, coal mine reclamation presents several actuarial challenges. Coal mining, and the need for reclamation, is driven by forces from individual companies or small geographic regions to national policy, macroeconomic conditions, and the global economy. In addition, single company insolvencies can trigger cascades of permit revocations and coal mine reclamation costs. Our actuaries have experience with coal mine reclamation funds in multiple states, and we have developed approaches to deal with these issues.

We take the view that projecting financials for coal mine reclamation funds is best accomplished through a variety of methods, rather than any single approach. As a result, we rely on both traditional methods and statistical approaches where feasible. While relying on a single method could lead to unintentionally biased results, our approach ensures that we have the opportunity to capture any relevant risk factors of concern while maintaining the stability and transparency of traditional approaches.