May 18, 2015
Port Moresby, Papua New Guinea, 18th May 2015— The Pacific Financial Inclusion Programme (PFIP) and Bima launched a partnership today to provide micro insurance products in rural Papua New Guinea (PNG), including the Highlands Region. PFIP’s partnership and investment in Bima is made possible through the support of the European Union and the Australian Government, and through the commitment of the Bank of Papua New Guinea (BPNG) and its Governor, Loi Bakani.
“The European Union along with Bank of Papua New Guinea are extremely pleased about our support to the Pacific Financial Inclusion Programme that made possible this investment in Bima – a mobile microinsurance platform that will expand to the Highlands and make insurance more affordable for the people who need it most”, said Ambassador Dihm.
Picture Caption: Governor Loi Bakani, Bank of PNG and Bima Regional Director Puay Lim Yeo, with Maria Muñoz from the European Union at the announcement of PFIP’s support for BIMA mobile microinsurance in PNG’s Highlands Region.
Picture Credit: Shadiyana Begum, PFIP
The goal of the investment with Bima is to bring convenient, affordable micro insurance products to low-income, rural, unbanked or underbanked Papua New Guineans. Under this investment, Bima with PFIPs support will provide two insurance products: life insurance and hospitalisation insurance. Bima aims to provide over 75,000 low-cost insurance policies to rural Papua New Guineans within two years, including 50% women and 90% rural-based.
The UN Resident Coordination in PNG Roy Trivedy stated that “insurance penetration as a percentage of GDP in Papua New Guinea is shockingly low, at less than 2%, compared to the global average of 7.5%. Low income households are not covered because of four major obstacles; education, distribution, pricing and premium collection. Through our investment in Bima, we are excited about supporting a unique scalable business model between Bima, Digicel and Capital Life Insurance to bring affordable and accessible insurance to the Highlands Region”.
The life insurance covers death and total permanent disability. By insuring the low-income people of PNG, Bima aims to help households weather the impact that a death of a breadwinner can have on a family. Funerals are expensive in PNG and can create financial burdens for families. The life insurance product is available at three different prices. There are 3 cover types with the lowest life insurance cover costing K4,000 with a K3.6 monthly premium and the highest cover type being K12,000 with a K10.8.
The hospitalization insurance cover provides customers with a fixed amount of money for each day spent in hospital (from the 2nd night), up to 30 nights over a 12 month period. Coverage costs less than a daily SMS, and hospitalization insurance will allow families to seek preventive health care and insure vulnerable segments of PNG’s population. This product will be available different prices with different cover levels with the lowest monthly premium of K3.6 and the highest monthly premium of K10.8.
PFIP will support Bima’s plans to establish a local presence in Lae, Mount Hagen and Madang. This partnership will lead to the establishment of a more formal setup in Mount Hagen including an office, where training can take place and where agents can access computers to check the status of customers. Increasing the number of agents in Mount Hagen makes it possible to reach more highland citizens rapidly. The expected impact of this investment is an increase in the number of registrations made in the highland by the field force by 2,160 members per year per agent (+ 25,920 in total). Reaching the isolated villages, and providing education will help improve the productivity per agent, and reach more isolated areas. Bima will also provide education on insurance, prior to sales for the less educated and isolated populations who would not otherwise benefit from the awareness that Bima will create in Mount Hagen.
PFIP aims to add one million Pacific Islanders to the formal financial sector by 2019 by spearheading policy and regulatory initiatives, facilitating access to appropriate financial services and delivery channels and by strengthening financial competencies and consumer empowerment.
PFIP is a Pacific-wide programme helping low-income households gain access to quality and affordable financial services and financial education. It is jointly managed by the UN Capital Development Fund (UNCDF) and the United Nations Development Programme (UNDP) and receives funding from the Australian Government, the European Union and the New Zealand Government.
PFIP operates from the UNDP Pacific Centre in Suva, Fiji and has offices in Papua New Guinea and Solomon Islands. It will open an office in Samoa in 2015.
For more information or media inquiries please contact:
In Port Moresby:
Tenzin Keyzom Ngodup; PNG Mobile: +675 72452514; email@example.com
Shadiyana Begum; Tel: +679 3227538; firstname.lastname@example.org;