Overview:
Papua New Guinea has made its first-ever parametric insurance payouts after a 6.6-magnitude earthquake struck in December, delivering fast financial relief to 3,200 people across three provinces. The milestone payment highlights a new disaster financing approach designed to get support to vulnerable communities—especially women—within days, not months.
PORT MORESBY, 16 FEBRUARY 2026 (UNDP)—The first parametric insurance payments in Papua New Guinean history have been delivered following an earthquake that impacted Eastern Highlands.
Madang and Morobe Provinces in December 2025, with 3,200 beneficiaries receiving financial support through the Women’s Micro-Bank Limited (Mama Bank).
The earthquake, which occurred in December and reached 6.6 magnitude, activated pre-agreed thresholds under a parametric insurance policy launched last September, resulting in total payments worth PGK 18,400(US$4,290). The transfers were made digitally within 14 days to community members impacted by the disaster.
“Although this first payout is modest, it marks a significant milestone for Mama Bank’s 3,200 customers across three locations in Papua New Guinea. It underscores our commitment to introducing innovative solutions to customers and delivering timely and reliable financial protection when communities need it the most,” stated the CEO of Mama Bank, Gunanidhi Das.
Parametric insurance differs from traditional insurance by triggering payments based on pre-defined data thresholds, such as earthquake magnitude or rainfall levels, rather than individual loss or damage assessments.
The initiative was introduced in Papua New Guinea through a partnership between the UN Capital Development Fund (UNCDF), United Nations Development Programme (UNDP), UN University Institute for Environment and Human Security, Mama Bank, local insurer, Pacific MMI, Pacific Reinsurance, and the Governments of Australia and New Zealand.
“This first payment demonstrates how innovation in finance can translate directly into greater resilience for communities across Papua New Guinea. By linking science, data and digital delivery systems, parametric insurance ensures that support reaches people quickly when disasters strike. This is a game changer in PNG, where many vulnerable groups have little experience with formal insurance claims and live in remote areas with limited access to financial services,” UNDP Resident Representative and UNCDF Country Representative in PNG, Nicholas Booth.
“This is excellent news for the customers of Mama Bank and Pacific MMI Insurance (PMMI) is delighted to participate in this unique cover that provides insurance protection against earthquakes, cyclones, drought, and excess rainfall for Mama Bank’s customers,” said Pacific MMI CEO, Darryl Williamson.
“The policy is specifically aimed at helping women farmers, fishers, MSMEs, informal sector workers and other climate-vulnerable groups. The recent claim payments illustrate the benefits of this cover and PMMI is proud to pay the claim losses quickly and professionally.”
Following the successful pilot in 2024, Mama Bank has now expanded the product from covering 10,000 to 20,000 customers in Papua New Guinea, the vast majority of whom are women.
The parametric insurance programme launched in PNG is part of a wider roll-out of the product in the Pacific. Across eight Pacific Island, UNDP and UNCDF are working with Pacific Reinsurance to expand access to parametric insurance in climate vulnerable communities.
“UNCDF and UNDP are proud to work alongside its partners in PNG and the wider Pacific to help build countries’ financial resilience and reduce the economic shock of disasters. By introducing and expanding access to new risk financing tools, we can deliver real development outcomes for some of the most climate vulnerable populations on the planet.” …PACNEWS
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