PCRIC & WTW sell parametric quake insurance for submarine cable network
The Pacific Catastrophe Risk Insurance Company (PCRIC) alongside broker WTW have designed a parametric trigger to provide a responsive disaster insurance policy to a Papua New Guinea operator of a submarine fibre optic cable network.
The parametric insurance policy will provide rapid payouts after earthquakes that are expected to result in damage to the submarine fibre optic cable network surrounding Papua New Guinea (PNG), that is operated by state-owned enterprise PNG Data Co.
With suitable coverage from the private insurance sector 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 WTW to deliver a solution that highlighted the benefits of parametric insurance as a way of providing financial protection when traditional coverage options are lacking.
The parametric insurance policy will provide rapid financing in the event of major earthquakes that could damage the undersea cable network, helping to ensure service continuity and enabling any necessary repairs to be made more quickly.
PCRIC CEO, Mr. Aholotu Palu, said, “We are indeed proud of our efforts to work with PNG Data Co., 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.”
PNG Data Co. CEO, Mr. Paul Komboi, added, “PNG Data Co. is very excited about the robust partnership now formed. We believe that this is a historic milestone for our region and a testament to our shared vision and commitment and look to continued engagement with PCRIC in the coming years. Our joint efforts truly showcase the merit of partnership and mutual commitment in addressing regional risk challenges.”
WTW Senior Director for Disaster Risk Finance, Dr. Simon Young, also said, “This was a collaborative effort between PNG Data Co, 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.”
