WTW Launches Parametric Solution to Safeguard Coral Reefs in the South Pacific
WTW Launches Parametric Solution to Safeguard Coral Reefs in the South Pacific
WTW has launched a new parametric insurance policy designed to safeguard the coral reef system of the Lau Group of islands in the South Pacific. 

The Lau islands, comprising sixty islands and islets spanning over 114,000 square kilometers of ocean, face various threats including sea level rise, ocean warming, acidification, and the heightened frequency of tropical cyclones.

The challenges pose risks to both the coral reefs and the livelihoods of the Indigenous people of Lau who depend on them for sustenance and income.

The region currently lacks adequate climate risk protection options beyond traditional insurance policies that cover fixed assets such as property, which only pay out after physical damage occurs following a lengthy loss-adjustment process.

Coral reef, South Pacific

WTW collaborated closely with Fiji’s Vatuvara Foundation (VVF), the policyholder of the insurance program, to develop a specialized insurance product tailored for a subset of the Lau islands. This initiative aims to ensure that payouts are swiftly deployed to help communities withstand cyclone impacts and manage natural resources effectively to enhance ecosystem resilience.

In partnership with local correspondent broker Insurance Holdings (Pacific) Pte Ltd., Vatuvara Foundation selected Pacific Catastrophe Risk Insurance Company (PCRIC) to administer the policy. The insurance payouts will support VVF-led initiatives such as rapid reef response activities and community assistance efforts addressing food and water security concerns arising from storm damage.


These proactive measures are crucial in mitigating overharvesting and further degradation of Lau’s coral reef system during the community’s recovery from cyclones. The introduction of this innovative insurance program marks a significant step toward protecting the delicate marine ecosystems of the South Pacific.

Sarah Conway, Director and Ecosystem Resilience Lead, WTW, commented, saying: “We are grateful to BHP for supporting the design and implementation of the first coral reef insurance programme in Fiji. Building on lessons learned from our involvement with similar initiatives in other countries, this programme provides an exciting opportunity to innovate beyond rapid reef response to also include community assistance, enhancing the resilience of the ecosystem and those who depend on it.”

Katy Miller, Director, Vatuvara Foundation, also commented, sayong: “We are thankful that the innovative parametric policy will allow for the prompt access to funds following a destructive cyclone event to identify reef damage and assist reef recovery with a community-led team in Northern Lau. Increased frequency and severity of extreme weather events is expected in the area, and protecting natural ecosystems in the Lau Group is crucial to build long-term community resilience to anthropogenic threats including climate change.”

“BHP is funding an innovative parametric insurance product, which aims to support the conservation of coral reefs and surrounding local communities in Fiji’s northern Lau Group, and build the knowledge base for how similar financial products could be used to improve climate resilience,” said Ashley Preston, Head of Climate Resilience, BHP. “We are pleased to work with WTW and Vatuvara Foundation on this project, which supports BHP’s commitments to action on climate, conservation and empowering communities.”

Aholotu Palu, CEO of PCRIC, added that PCRIC was delighted to demonstrate its commitment to serving non-sovereign entities with innovative parametric insurance products. He said the move demonstrated, “PCRIC’s mission to help the island communities of the Pacific to better prepare, structure and manage finances to foster disaster resilience and ensure rapid access to funds.”

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