PCRIC and WTW launch parametric quake cover for Papua New Guinea submarine cable network

The Pacific Catastrophe Risk Insurance Company (PCRIC) alongside broker WTW have designed a parametric insurance policy to help protect PNG DataCo., a Papua New Guinea (PNG) operator, from the financial impact of earthquake damage.

The parametric insurance policy will provide rapid payouts following earthquakes that are expected to result in damage to the submarine fibre optic cable network surrounding PNG, which is managed by state- owned PNG DataCo.

PNG DataCo. constructs, owns and operates the critical national transmission network, including the installation and oversight of submarine fibre optic cables in the country.

As suitable coverage from the private insurance sector was seen as unavailable, PNG Data approached PCRIC to explore the possibility of creating a bespoke insurance product to meet its specific needs.

PCRIC worked closely with global broker WTW to develop and deliver a solution that highlighted the advantages of parametric insurance as a way of providing financial protection when traditional coverage options are lacking.

On top of helping protect PNG DataCo. from the financial impact of earthquake damage, providing funds for rapid response to any damages, the insurance coverage also boosts PNG’s disaster resilience.

PCRIC CEO, Aholotu Palu, stated: “We are indeed proud of our efforts to work with PNG DataCo., persisting until we were able to table a fully tailored solution to their insurance challenge.

“Such coverage marks a significant turning point in the development of our capability to provide non-sovereign insurance products to state-owned entities within the Pacific Islands region.”

WTW Senior Director for Disaster Risk Finance, Dr. Simon Young, said: “This was truly a collaborative effort between PNG DataCo, PCRIC and colleagues across WTW’s Alternative Risk Practice.

“We were pleased to contribute our experience in designing bespoke parametric solutions, along with our expertise in risk analytics, to create an insurance coverage for critical infrastructure which meets both the needs of the client and the requirements of the international markets, where WTW ultimately placed the risk on PCRIC’s behalf.”

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