Capital Insurance – Property Insurance Research

Capital insurance photoCountry: Papua New Guinea (PNG)

Partner: Capital Insurance Group Ltd. (Capital)

Date: 31 January 2016 – 31st January 2017

Grant: PGK 213, 000

Target: Low income population segments in urban and rural locations

Current reach: Not applicable




Papua New Guinea is one of the least insured countries in the world. It is estimated that premiums comprise just 1.4% of GDP. The impact of financial shocks such as natural disasters or fire on low-income households and communities can be severe, plunging them into financial hardship. Inclusive insurance is key to improving the risk resilience of households and communities in case of devastating losses.

Low uptake of insurance in PNG is due historically to challenges of geography, topography, financial literacy, levels of disposable income, a multiplicity of languages, contains on supplier reach and cultural behavioural practices. Furthermore, many of PNG’s people are illiterate and awareness of insurance is generally very low.


Capital Insurance plans to launch two property insurance products to meet this need, firstly for a household property product targeting low income households and secondly for a community owned assets product aimed at communal property such as churches, schools and water pumps, however a market assessment must first evaluate their potential. If launched these products if have the potential to benefit up to 47,000 people and 9,215 homes, as well as attendees of over 2,700 schools and 50 churches plus Certain assets and infrastructure at hundreds more of sites.

Capital has a track record of successfully designing and selling inclusive insurance products to people in the low-income and rural segments. Within these segments Capital is looking to expand beyond the life and hospitalisation microinsurance products that it now underwrites, and to move into asset protection insurance. Two products have been identified that need significant research and development effort before their potential can be properly evaluated and commercially assessed.


The project will assess market potential and seek to identify product designs, distribution channels and a business model to effectively supply these products on a commercially sustainable basis.

The PFIP investment allows these important research studies to take place, to check market understanding and acceptance of the concepts, to identify potential distribution outlets, refine product features and pricing and gain information to better understand how customers can be educated on the products.

The project will lead to a clearer appreciation of the potential to deepen penetration of inclusive insurance in PNG. Depending on the outcome of the research, one or both of the products may be rolled out and if so, insurance coverage would improve and new insurance distribution networks could emerge.

About Capital Insurance:

Capital Insurance Group Ltd is the ultimate holding company for wholly owned subsidiary licensed insurers in various Pacific jurisdictions. These include Capital Life Insurance Ltd., Capital General Insurance, Capital Insurance (SI) Ltd. and Dominion Insurance Ltd. Headquartered in Port Moresby, the Group is privately held by four leading non-bank financial institutions; Teachers Savings & Loans Society 28%; Nambawan Super Ltd 27%; Credit Corporation (PNG) Ltd. 25%; Nasfund Ltd. 20%.