Helping governments better respond to climate shocks through rapid payouts, ARC Ltd. has paid out over US$170 million in claims to support vulnerable communities. The company has also evolved significantly, fom offering only drought insurance, it now covers both crops and livestock, and has diversified its product portfolio to include floods, tropical cyclones, and health-related risks, such as outbreaks and epidemics.

“We started out with the premise that partnering governments would be the most effective way to progress on this disaster risk management and financing journey, and it proved correct,” comments ARC Ltd. CEO Lesley Ndlovu. “We have successfully built and nurtured these relationships and been able to sign up 39 member states across Africa.”

Beyond working with governments, ARC Ltd. has extended its partnerships to include providing insurance to humanitarian agencies like the World Food Programme, Start Network, and the UN High Commission for Refugees to support vulnerable populations. The company also works with the private sector via reinsurance to protect the incomes of small- to medium-scale farmers, who are most at risk from climate change impacts.

“I am particularly pleased with the over US$170 million we have paid in claims. Behind these figures are communities across Africa that benefited after they were struck by natural disasters,” says Ndlovu. “We are also pleased by the number of countries that now utilise insurance as part of their disaster risk financing matrix. And while it’s too early to say that the battle is won, we have made significant progress in shifting from reactive to more proactive disaster risk management and financing approaches over the past decade.”

Pioneering innovative products and risk transfer solutions tailored to individual countries’ changing needs are central to ARC Ltd.’s activities. “Additionally, the increasing severity and frequency of natural disasters is a critical focus for us. This phenomenon highlights the importance of having multiple financial instruments to complement the insurance offering for which we are known,” says Ndlovu.

Looking ahead, ARC Ltd. aims to expand its coverage across all 55 African Union countries. “According to the latest data, we estimate that there are 700 million people whose economic livelihoods and lives are at risk due to climate change. Our mandate, mission and vision as an organisation is to provide coverage to all who need it. This is what motivates us every day,” says Ndlovu. “What started as a concept has evolved in 10 years to become a proven and trusted solution for the continent. We will keep scaling up for even more impact.”

**Ends**

For more information about The African Risk Capacity Limited (ARC Ltd), or to arrange an interview, please contact Sonnette at sonnette@bigambitions.co.za.

About ARC Ltd.

The African Risk Capacity Limited (ARC Ltd.) is a financial affiliate of the African Risk Capacity (ARC) Group, a specialised agency of the African Union (AU), an initiative designed to improve current responses to climate-related food security emergencies.

ARC Ltd. is a mutual insurance facility comprised of its members, which have included Kenya, Mauritania, Niger, Senegal, Mali, Malawi, the Gambia, Burkina Faso, Chad, Zimbabwe, Togo, Madagascar, and Zambia.

The membership also includes its capital contributors who have provided premium subsidies, including USAID, FCDO, SDC, KFW/BMZ, IFAD, AFDB, WFP and STARTNETWORK.

The recipients stood out among 15 finalists for their academic excellence, community activism, demonstrated leadership, and passion for sustainability.

Ange-Emmanuelle Gblaka from Côte d’Ivoire, Sandrine Dorvale Bassong Bayegle from Cameroon, and Kossi Mose Doumassi from Togo began their studies at the Institut de Formation en Alternance pour les Générations Engagées (IFAGE) in Dakar, Senegal in January. Doreen Mulwa from Kenya and Maulid Seleman from Tanzania will embark on their academic journeys at the University of Cape Town in 2025, pending admission.

“The scholarship recipients are an impressive group. With limited resources, they are already driving change and making a real impact as young changemakers in their communities. We are excited to be a part of their journey and watch how they take this educational opportunity to turn it into meaningful action,” says ARC Ltd. CEO Lesley Ndlovu.

The comprehensive scholarships will fully cover tuition, housing, living stipends, and other essential expenses for up to three years of full-time study. This exceptional opportunity will allow the students to gain expertise in critical fields like actuarial science, risk management, and agricultural statistics.

Since 2014, ARC Ltd. has delivered climate risk insurance to African Union member states. These scholarships seek to extend that mission by developing highly skilled talent to contribute to developing African solutions to African problems. Milliman Inc. lends its risk management and actuarial expertise to the scholarship programme.

As ARC Ltd. CEO Lesley Ndlovu says: “The urgent need for Africa to develop leaders, including women leaders, well-versed in the complex challenges of climate change cannot be overstated. With threats like droughts, floods and extreme weather events, Africa remains one of the most vulnerable regions globally. These scholarships empower the next generation to gain the skills needed to drive climate resilience back home.”

Milliman Inc. Principal Joy Schwartzman echoes the sentiment: “We hope to make a real impact on Africa’s ability to understand and address climate risk through the Africa Scholarship Programme. By investing in the next generation, we are investing in a more sustainable future.”

The scholarships for Master’s programmes in Actuarial Science and Insurance at IFAGE play an essential role in working towards the goal of developing the insurance and risk management sectors across Africa. These scholarships enable talented students to access quality education by eliminating financial barriers.

“Our collaboration with the Africa Scholarship Programme perfectly aligns with IFAGE’s mission to train a new generation of insurance and finance professionals who can provide the African insurance market with operational and competent professionals right after graduation. This scholarship represents much more than an opportunity. It is an invitation to explore, learn, and grow in the financial sector,” said Mrs. Kandji Rokhaya, General Manager of the Inter-African Institute for Training in Insurance and Business Management of IFAGE.

Chantal Swartz of the University of Cape Town (UCT) added that the Africa Scholarship Programme would strengthen UCT’s transformation imperative and contribute to UCT’s efforts in promoting diversity and inclusion within its student body. Swartz added that UCT’s goal is to produce research that answers the complex problems of today and tomorrow.

“In line with UCT’s Vision 2030, our dream is to draw from the extraordinary social and cultural diversity, creativity and capacity for innovation of all our staff and students to contribute to making the 21st century, the African century,” said Swartz.

“These students carry the hope of Africa on their shoulders. We challenge them to make the most of this life-changing opportunity. The future needs their ideas, their passion, and their leadership,” Ndlovu concludes.

The Africa Scholarship Programme was launched in 2023 and will soon release applications for the 2024 programme. Find out more at www.arcltd.org/scholarships

**Ends**

For more information about The African Risk Capacity Limited (ARC Ltd), or to arrange an interview, please contact Sonnette at sonnette@bigambitions.co.za.

About ARC Ltd.

The African Risk Capacity Limited (ARC Ltd.) is a financial affiliate of the African Risk Capacity (ARC) Group, a specialised agency of the African Union (AU), an initiative designed to improve current responses to climate-related food security emergencies.

ARC Ltd. is a mutual insurance facility comprised of its members, which have included Kenya, Mauritania, Niger, Senegal, Mali, Malawi, the Gambia, Burkina Faso, Chad, Zimbabwe, Togo, Madagascar, and Zambia.

The membership also includes its capital contributors who have provided premium subsidies, including USAID, FCDO, SDC, KFW/BMZ, IFAD, AFDB, WFP and STARTNETWORK.

Says ARC Ltd. COO Ange Chitate, who heads up the project: “ARC Ltd. is committed to protecting the livelihoods of farmers and pastoralists across our African Union member states. Our priority with this grant is to provide coverage to 19 states, and with the support of the USG, we will refine and develop innovative products that will meet the evolving needs of these countries.”

The project has two primary objectives. Firstly, governments will be assisted with capacity building to manage climate change-induced disasters through the effective use of parametric insurance. To this end, ARC Ltd. will work closely with governments to customise risk models for each country, establish contingency plans and integrate parametric insurance into policy frameworks. This localisation helps ensure that the insurance payouts will meet the real needs on the ground.

Secondly, the project seeks to increase the uptake of parametric insurance through close cooperation with the African Union and regional economic communities to encourage adoption. It will also focus on aligning domestic policy frameworks with regional policies to embed parametric insurance in existing climate adaption frameworks.

Increasing climate change impacts requires responsive diversification to ensure the project’s long-term sustainability and ARC Ltd. is committed to expanding its portfolio to cover more countries, hazards and people. Plans include developing demand-driven micro/meso insurance and diversifying beneficiaries, such as pastoral farmers locally and humanitarian organisations internationally.

Various activities have been identified to achieve the objectives. On the technical side, ARC Ltd. will further refine and develop new products for member states with a focus on drought, flood and tropical cyclone models. ARC Ltd. will also work more extensively with technical and financial partners, UN agencies, international financing institutions and universities to identify how data can be used for increased evidence-based policy decision-making and impact measurement.

To pave the way for more countries to participate in the risk pools, ARC Ltd. together with ARC Agency, will align technical, governance, and policy capacity with the risk pool requirements by hosting risk transfer workshops in select countries. Training local experts is also a key focus.

ARC Ltd. will also complete policy underwriting for single and multiperil cover, having identified the countries that qualify for each.

The USA aims to help more than half a billion people in developing countries to adapt to and manage the impacts of climate change through President Biden’s Emergency Plan for Adaptation and Resilience (PREPARE). With this partnership, it has strengthened its strategic interests in disaster risk financing in Africa while signalling its commitment to investing in locally led climate solutions. For ARC Ltd., this project aligns with its mission to safeguard more nations and create effective pan-African climate response systems.

 “ARC Ltd. has set an ambitious goal of protecting the lives and livelihoods of 700 million vulnerable people in Africa by 2034,” says ARC Ltd. CEO Lesley Ndlovu. “The partnership with the United States Government, and others, will help us achieve this goal. It also demonstrates the commitment of developed nations to building the resilience of the global south to withstand climate disasters.”

**Ends**

For more information about The African Risk Capacity Limited (ARC Ltd), or to arrange an interview, please contact Sonnette at sonnette@bigambitions.co.za.

About ARC Ltd.

The African Risk Capacity Limited (ARC Ltd.) is a financial affiliate of the African Risk Capacity (ARC) Group, a specialised agency of the African Union (AU), an initiative designed to improve current responses to climate-related food security emergencies.

ARC Ltd. is a mutual insurance facility comprised of its members, which have included Kenya, Mauritania, Niger, Senegal, Mali, Malawi, the Gambia, Burkina Faso, Chad, Zimbabwe, Togo, Madagascar, and Zambia.

The membership also includes its capital contributors who have provided premium subsidies, including USAID, FCDO, SDC, KFW/BMZ, IFAD, AFDB, WFP and STARTNETWORK.

Even more sobering is that the bulk of the fatalities were in Libya alone. More than 11 300 people died in September when Storm Daniel caused two dams to overflow in the coastal city of Derna. In the catastrophic flooding that followed, people and buildings were washed out to sea. Researchers believe climate change was to blame for increasing the probability and intensity of this extreme weather event by as much as 50%.

More than 20 other flood disasters occurred across the continent, affecting numerous countries. In early November, Kenya experienced torrential rains followed by flooding that forced 4 000 families to flee their homes. As many as 1 000 livestock died and 97 hectares of cropland were wiped out. In the aftermath of floods, communities face further challenges – the risk of waterborne diseases, food shortages, and the daunting task of rebuilding.

Tropical cyclones are also happening with alarming regularity, battering coastlines, flattening villages, and wiping out the economic lifelines of many communities. Tropical Cyclone Freddy, which began its path of destruction in February, persisted for 34 days. Impacting Madagascar, Mozambique, Mauritius, Malawi, Réunion, and Zimbabwe, it left at least 860 people dead, destroyed homes and cropland, and caused cholera outbreaks in its wake.

In contrast, the Horn of Africa has been gripped by persistent drought conditions, impacting more than 29 million people. The communities in the region are dependent on rain-fed agriculture and pastoralism, but the prolonged drought, said to be the worst in some 40 years, has turned arable land to dust, caused crop failure, water scarcity and decimated livestock herds. The ripple effect is huge – people are forced to leave their homes in search of pasture and water, resulting in mass population displacement. Malnutrition rates, especially among children, have soared and as many as 4 million people in the region are now acutely food insecure.  

Scientists weigh in

A group of international scientists has concluded that human-induced climate change increased the severity of the drought in the southern part of the Horn of Africa, which includes southern Ethiopia, southern Somalia, and eastern Kenya. They say the likelihood of such droughts has increased 100-fold.

“State fragility and conflict, as well as the length of the drought played a significant role in worsening outcomes, especially for people in Somalia. Further, the severity of impacts linked to the long duration of the drought also raises serious questions about the length of droughts that government drought management systems and the international aid infrastructure should be prepared to handle in the future,” they point out.

This year has also seen heatwaves across Southern Africa and extreme heat in Northern Africa, especially Algeria, which led to deadly wildfires. While heatwaves are not officially categorised as disasters, their impact on populations is significant. Climate scientists explain that in addition to climate change, extreme events are also compounded by the El Niño weather phenomenon.

The Carbon Brief report points out another critical issue – the lack of weather stations in Africa, which makes it difficult to track and record extreme weather events, thereby contributing to underreporting. This is particularly true for heatwaves, which are often not recorded due to the absence of observable impacts like those seen with floods or cyclones. The lack of data and reporting on these events makes it challenging to prepare for and mitigate their impacts.

The scale of disasters

The combination of climate change, poverty, and action (or in-action) in Africa paints a complex picture. Natural disasters push vulnerable communities to the limits of their resilience, while poverty hampers their capacity to recover. At the same time, a lack of in-country emergency preparedness and climate adaptation strategies leaves many nations on the back foot.This is where innovation and strategic public-private partnerships can make a significant difference.

Recently, in Malawi, African Risk Capacity Ltd., a parametric insurer the financial affiliate of the ARC Group, launched an insurance innovation to help the government expand the World Bank’s Social Support for Resilient Livelihoods Project already underway in the country. “It incorporates a risk transfer instrument and a risk-layering approach that will enable Malawi to safeguard more vulnerable households from climate shocks and guarantee faster access to financing,” explains ARC Ltd. Head of Business Operations David Maslo. “This social protection insurance innovation has significant potential for replication across Africa, while encouraging other governments and global organisations to take a progressive, collaborative approach.”

Action for Africa

Thedevastating impact of several extreme weather events in one year in Africa serves as a grim reminder of the consequences of climate change. This continental crisis must catalyse a transformative climate agenda that prioritises the vulnerable, and COP28 presents an opportunity for actionable and results-oriented strategies to take centre stage. The time has come to move beyond vision and mission to actively shape a future where extreme weather does not dictate the fate of Africa.

**Ends**

For more information about The African Risk Capacity Limited (ARC Ltd), or to arrange an interview, please contact Sonnette at sonnette@bigambitions.co.za.

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About ARC Ltd.

The African Risk Capacity Limited (ARC Ltd.) is a financial affiliate of the African Risk Capacity (ARC) Group, a specialised agency of the African Union (AU), an initiative designed to improve current responses to climate-related food security emergencies.

ARC Ltd. is a mutual insurance facility comprised of its members, which have included Kenya, Mauritania, Niger, Senegal, Mali, Malawi, the Gambia, Burkina Faso, Chad, Zimbabwe, Togo, Madagascar, and Zambia.

The membership also includes its capital contributors who have provided premium subsidies, including USAID, FCDO, SDC, KFW/BMZ, IFAD, AFDB, WFP and STARTNETWORK.

JOHANNESBURG – A record total payout of US$60 million in 2022 is among the highlights detailed in ARC Ltd.’s integrated annual report, together with significant strides in innovation to safeguard African nations from the increasing risks associated with climate change.

The payout was the largest since the company’s inception in 2014, underpinning the value of the company’s work as Africa’s first sovereign parametric development insurer. In 2022, ARC Ltd. covered 18 million people in countries prone to drought and tropical cyclones. Since 2014, the company has paid out US$125 million across eight risk pools, making a significant difference to the lives and livelihoods of at-risk communities.

Chairman of the ARC Ltd. Board, Dr Abdoulie Janneh points out that this accomplishment was made possible due to a network of support: “Our donors and partners stood with us as we sought to protect the most vulnerable from climate change impacts in Africa. No one person or organisation can make the impact alone, and we are heartened that behind ARC Ltd. is a powerful and dedicated group of stakeholders, who are fully committed to our success. Together, we faced unprecedented challenges, but also achieved significant milestones.”

These milestones include Comoros and Somalia joining the pool as ARC Ltd. focuses on expanding its member states, thereby covering more people. It has set the ambitious target of covering 200 million people annually by 2025 and positioning itself as the continent’s leading institution for disaster risk financing.

Innovation and product diversification are central to this and 2022 saw the launch of two new products: flood risk, and outbreaks and epidemics (O&E). Malawi and Togo piloted flood risk, while Uganda piloted O&E, with Senegal becoming the first member state to sign up for the O&E policy. Despite an increasingly difficult environment, ARC Ltd. also made strides in expanding its non-sovereign and micro/meso insurance portfolio.

Explains ARC Ltd. CEO Lesley Ndlovu: “The global macroeconomic environment experienced a weakening trend, leading to diminished financial capabilities of our member states. This reduced their ability to afford insurance premiums, as national priorities, such as healthcare and education, competed for limited resources. The effect of these challenges was evident in 2022.”

Ndlovu says it is only with the assistance of donors and partners that disaster risk insurance can be made more accessible. In 2022, ARC Ltd. was supported by the Swiss Agency for Development and Cooperation (SDC) for the launch of the Outbreaks and Epidemics product through capital and premium contributions.

A leader in ESG

In terms of company successes, the annual report highlights ARC Ltd. receiving the global insurance industry’s top environmental, social and governance (ESG) score, following an evaluation by ESG research, ratings and data company, Sustainalytics. ARC Ltd. moved from low risk to negligible risk, improving by two positions, and at 5.7, its ESG risk rating is the lowest among its global peers. 

ARC Ltd. also leads in the Diversified Insurance sector, with the lowest exposure among its peers (24.0) and the strongest management score (80.3). It also scored negligible risk ratings for data privacy and security, corporate governance, human capital, business ethics and ESG integration.

Looking ahead at goals for 2023, Ndlovu says ARC Ltd. remains focused on new products and tailoring solutions for individual countries to meet their needs. The company also wants to expand its Replica programme by partnering with more humanitarian organisations and launching the programme in additional countries.

“The urgency for disaster risk insurance has never been greater, given the escalating frequency and intensity of perils, but with the support of our stakeholders and the collective efforts of our exceptional team, we are poised to continue making meaningful strides in the fight against climate change,” concludes Ndlovu.

To view ARC Ltd.’s 2023 integrated annual report go to https://bit.ly/467RiFg

**Ends**

For more information about The African Risk Capacity Limited (ARC Ltd), or to arrange an interview, please contact Sonnette at sonnette@bigambitions.co.za.

About ARC Ltd.

The African Risk Capacity Limited (ARC Ltd.) is a financial affiliate of the African Risk Capacity (ARC) Group, a specialised agency of the African Union (AU), an initiative designed to improve current responses to climate-related food security emergencies.

ARC Ltd. is a mutual insurance facility comprised of its members, which have included Kenya, Mauritania, Niger, Senegal, Mali, Malawi, the Gambia, Burkina Faso, Chad, Zimbabwe, Togo, Madagascar, and Zambia.

The membership also includes its capital contributors who have provided premium subsidies, including USAID, FCDO, SDC, KFW/BMZ, IFAD, AFDB, WFP and STARTNETWORK.

JOHANNESBURG – African Risk Capacity (ARC) Limited has announced the appointment of two non-executive directors to its Board. The hybrid mutual insurer and financial affiliate of the African Risk Capacity Group has appointed Deepak Dave and Maxwell Mkwezalamba for a three-year term, ending with the ARC Ltd. AGM in 2026.

The pair have extensive Board experience in directorship roles and expertise across the African political network, meteorology, climate change, insurance, the financial sector and development in Africa.

Deepak Dave has more than 24 years’ experience in banking, capital markets and private finance in Canada, the UK, Africa, among others. His strengths lie in executive leadership of strategic change, revenue origination and team management. Dave is seasoned in the areas of acquisition, expansion, recapitalisation and turnarounds, as well as senior and subordinated debt, project finance, structured trade and commodity finance, private capital, derivatives, credit and political risk insurance and reinsurance.

Maxwell Mkwezalamba is a professional economist in Lilongwe, Malawi, with more than 30 years’ experience in academia, the private sector, national government, as well as regional and international organisations. His areas of focus have been macroeconomic policy and analysis, public finance, international finance and development, regional integration and development, private sector development, policy dialogue and partnership engagement. Mkwezalamba has strong diplomatic and negotiating skills.

Dave and Mkwezalamba replace Jennifer Blanke and Phillip Pettersen, whose mandates ended in April this year and whose contributions to the work of the Board and the Company have been invaluable.

Comments ARC Ltd. CEO Lesley Ndlovu: “Deepak Dave and Maxwell Mkwezalamba were appointed following a stringent interview process conducted by our Nomination Committee. Comprising representatives from our Class A and Class C Members, they strongly recommended both candidates. We congratulate Deepak and Maxwell on their appointment and welcome them to the Board. We also express our gratitude to Jennifer Blanke and Phillip Pettersen for their input and dedication during their term.”

**Ends**

For more information about The African Risk Capacity Limited (ARC Ltd), or to arrange an interview, please contact Sonnette at sonnette@bigambitions.co.za.

About ARC Ltd.

The African Risk Capacity Limited (ARC Ltd.) is a financial affiliate of the African Risk Capacity (ARC) Group, a specialised agency of the African Union (AU), an initiative designed to improve current responses to climate-related food security emergencies.

ARC Ltd. is a mutual insurance facility comprised of its members, which have included Kenya, Mauritania, Niger, Senegal, Mali, Malawi, the Gambia, Burkina Faso, Chad, Zimbabwe, Togo, Madagascar, and Zambia.

The membership also includes its capital contributors who have provided premium subsidies, including USAID, FCDO, SDC, KFW/BMZ, IFAD, AFDB, WFP and STARTNETWORK.

In her speech, Mrs Rindra Hasimbelo RABARINIRINARISON, Minister of Economy and Finance said; “We are aware that Madagascar is prone to climate disasters, the frequency and intensity of which have continued to increase in recent years. The damage caused is more violent and the related costs are increasing. As such, the Malagasy Government is ready to take the necessary measures to continue its commitment to ensuring the sustainability of this insurance mechanism as an instrument that is adapted to the context of the country’s vulnerability to climate hazards.” She also stressed that “Madagascar, like many African countries, requires special support to strengthen resilience to climate change, especially as we are not perpetrators of the pollution that causes this scourge. We are at war, not amongst ourselves, but against climate change”.

As part of building resilience to the impending threat of cyclonic events, the Government of Madagascar and the World Food Programme took out two separate tropical cyclone insurance policies during the 2022/2023 cyclone season with ARC Limited, the insurance affiliate of the ARC Group, responsible for risk pooling and transfer. The country’s participation in the ARC risk pool was made possible by premium support from the Africa Disaster Risk Financing programme, a collaborative initiative between the Bank and the ARC Group, also known as ADRiFi. ADRiFi is designed to enable qualifying African governments’ participation in ARC risk pools. Contributions from the Governments of the United Kingdom and Switzerland, through the ADRiFi Multi-Donor Trust Fund managed by the Bank, subsidised the insurance premium payments.

Commenting on the ceremony, Lesley Ndlovu, Chief Executive Officer of ARC Limited, said, “We are delighted to be making this payout to the Government of the Republic of Madagascar to reach the most vulnerable communities and help the country rebuild. Our work with Madagascar over the years continues to prove the value of sovereign insurance as a valuable tool to strengthen a country’s resilience to weather-induced threats.” 

This payout comes as Madagascar rebuilds from a series of costly climate-induced disaster events that have eroded some of the country’s development gains and is critical aid for the island nation’s recovery efforts from Tropical Cyclone Freddy. ARC’s Tropical Cyclone Explorer (TCE), an online platform that calculates the number of populations affected and the economic losses caused by a cyclone event, modelled and assessed the estimated economic losses.

As of 10 March 2023, Madagascar’s National Bureau of Risk and Disaster Management (BNGRC) reported ten cyclone-related deaths, more than 120,000 people affected, with at least 45,000 people displaced, and more than 10,300 houses and schools destroyed.

“The AfDB, through the ADRiFi programme, supported the Malagasy Government to pay insurance premiums of $3.5 million. These subscriptions generated a total disbursement of $15 million from the ARC Group in the form of payouts. It is gratifying to know that the amount mobilised is more than 4 times greater than that paid in premiums, and even better, it has benefitted 385 589 vulnerable households who have been affected by droughts and tropical cyclones. I would like to reiterate the commitment of the AfDB to support the Government and the people of Madagascar in the effort to combat the harmful effects of climate change”, said Mr. Ada Amoumoun, AfDB Country Manager.

In line with ARC’s contingency planning process that stipulates the use of the payout, the funds will assist cyclone-affected communities, aiming to reduce incidents of impacted communities resorting to eating agricultural seeds as food, selling farm tools or migrating in search of work and food. These pre-approved plans ensure that there is a strategy for the rapid use of an insurance payout and prevent desperation by affected populations.

“More frequent and more intense climate shocks exacerbate the vulnerability of people, especially in the south and east regions of Madagascar.  While WFP is providing timely assistance to affected people, we are also eager to use our experience and expertise to shape longer-term solutions in Madagascar to strengthen people’s resilience”, says Pasqualina Di Sirio, WFP’s Representative in Madagascar. “WFP supports insurance schemes and subsidies to affected people to contribute to bolster people’s ability to face the climate crisis”, she adds.

Speaking at the payout ceremony, Ibrahima Cheikh Diong, UN Assistant Secretary General and ARC Group Director General said, “As we rally around the Government of Madagascar and its people in their time of need, we are once again reminded of the need for a collaborative effort to fight climate change. It is the cyclical nature and the increase in frequency and intensity of such disaster events that compounds the devastation. This demands that we work even harder to strengthen Africa’s capacity to respond and avail important tools such as early-warning systems to complement other efforts.”    

The Government of the Republic of Madagascar was the first country to enrol in the ARC Tropical Cyclone insurance programme since its launch in November 2020. During an active cyclone, ARC provides daily, real-time monitoring information on the strength and potential impact zones of the cyclone to help participating countries evacuate people in harm’s way. This warning system enabled Madagascan authorities to evacuate 7,000 people ahead of Cyclone Freddy’s landfall.

Commenting on the handover ceremony, the ARC donor group that has been instrumental in subsidising participation in ARC risk pools, echoed the same sentiment; “Our hearts go out to the people of Madagascar who have been affected by Cyclone Freddy.” This payout is the result of collaborative efforts from multiple stakeholders to build Madagascar’s resilience against the ravages of tropical cyclones. We reiterate our commitment to continue to support ARC in strengthening national capacities and community resilience in response to the growing climate threat.”

In 2022, ARC Group issued a payout of $10.7 million to Madagascar, following Tropical Cyclone Batsirai, another deadly cyclone that made landfall in Madagascar in February 2022.

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Ends

Media Contacts

For African Risk Capacity Group: Eva Kavuma, Chief Operations Officer, African Risk Capacity (ARC) Group, Email: eva.kavuma@arc.int 

For African Development Bank: Alphonso Van Marsh, Principal Digital Content and Events Officer, African Development Bank, Email: info@afdb.org

For Madagascar: Mrs Mamifaniry RAZAFINDRAMIANDRA, Head of Communication, Prevention and Emergency Management Unit ( CPGU)/Prime Minister’s Office, Email: faharivelo@gmail.com

For World Food Programme: Ms. Aina ANDRIANALIZAHA, Communication Officer,  aina.andrianalizaha@wfp.org

• A collaboration between African Risk Capacity (ARC) Limited and Milliman has made four scholarships available exclusively for African students.
• The ARC Ltd-Milliman Africa Scholarship Programme is aimed at further study in fields relating to mitigating the impact of climate change on African economies.

JOHANNESBURG, 16 MARCH 2023 – Africa’s premier institution for disaster risk financing on and for the African continent, African Risk Capacity Limited and Milliman, a risk management, benefits and technology company, have come together to launch a postgraduate Africa Scholarship Programme exclusively for African students. 

Aimed at studies relating to mitigating the impact of climate change on African economies, the programme will offer four scholarships to qualifying applicants, covering up to three years of full-time postgraduate study at select universities on the continent. 

The Africa Scholarship Program seeks to assist students who cannot afford postgraduate studies while promoting actuarial and related professions and gender equality. As such, female students are strongly encouraged to apply.

Milliman will provide the funding, while ARC Ltd. has already leveraged its relationships in Africa to make the programme a reality and will oversee it going forward. Additionally, the Africa Scholarship Programme ties in with the critical work that ARC Ltd. does in Africa, where it has been providing disaster risk insurance to its member states since 2014, and Milliman’s social responsibility objectives, with the latter serving the full spectrum of business, financial, government, union, education, and non-profit organisations.

Additionally, Milliman helps mitigate risk in vulnerable countries through their actuarial strengths and modelling frameworks.

Says Christal Morris, Milliman Chief Sustainability and DEI Officer: “We also seek to diversify talent and change the landscape and the demographics of the actuarial industry – this aligns well with the scholarship programme in Africa. Our desire to bring more gender parity to the profession has always been prominent, and by being part of the programme, we can aid in bridging that gap to access and educational resources.

“Our collaboration with ARC Ltd. presents an excellent opportunity to make a differential investment in demographic groups that don’t typically get this kind of attention. The programme has created the ability for both of our organisations to contribute in impactful ways.”

With the synergy between the two organisations evident, it is CEO of ARC Ltd., Lesley Ndlovu, who is the architect of the Africa Scholarship Programme, as he himself was once given a helping hand. Ndlovu explains: “My passion for scholarships providing opportunities for students stems from my own experience as a student at the University of Oxford. I was a beneficiary of a scholarship which was the foundation of my career. Working with Milliman to set up our own scholarship programme is my way of contributing to expanding access to opportunities for the next generation.”

Students will be able to apply to the following universities: 

• École Nationale Supérieure de Statistique et d’Économie Appliquée in Abidjan, Côte d’Ivoire
• Institut Interafricain de Formation en Assurance et en Gestion des Entreprises in Dakar, Senegal
• The National University of Science and Technology in Bulawayo, Zimbabwe
• The University of Cape Town in South Africa

They may choose from the following postgraduate degrees:

• Bachelor of Commerce Honours specialising in Actuarial Science
• Master of Science in Risk Management and Insurance
• Master in Actuarial Science
• Master in Agricultural Statistics

With applications now open, students are encouraged to put themselves forward for this life-changing opportunity. A prerequisite, however, is that they must commit to working in an African country for two years after graduation.

“We desire to see these graduates succeed, and therefore ARC Ltd. and Milliman will also be providing internships to give them a strong foundation in their chosen careers and an immersion in the challenges of risk management,” Ndlovu concludes.

Details of the scholarship and the application form are available on https://africanscholarship.org/.

Ends 

For more information about ARC Limited, or to interview Lesley Ndlovu, contact Natalia Rosa on
+27 83 449 4334 or natalia@bigambitions.co.za.  

For more information about Milliman, contact Jeremy Engdahl-Johnson on +1 646 473 3021 or jeremy.engdahl-johnson@milliman.com.

About ARC Limited  

The African Risk Capacity Limited (ARC Ltd) is a financial affiliate of the African Risk Capacity (ARC), a specialised agency of the African Union (AU), an initiative designed to improve current responses to climate-related food security emergencies.  

ARC Ltd is a mutual insurance facility comprised of its members, which have included Kenya, Mauritania, Niger, Senegal, Mali, Malawi, Gambia, Burkina Faso, Chad, Zimbabwe, Togo, Madagascar, and Zambia. 

The membership also includes its capital contributors who have provided premium subsidies, including USAID, FCDO SWISS, KFW/BMZ, IFAD, AFDB, WFP and STARTNETWORK. 

About Milliman

Milliman is among the world’s largest providers of actuarial and related products and services. The firm has consulting practices in healthcare, property & casualty insurance, life insurance and financial services, and employee benefits. Founded in 1947, Milliman is an independent firm with offices in major cities around the globe.  For further information, visit milliman.com

Madagascar has contingencies to aid its swift recovery from devastating impacts of tropical cyclones

• Madagascar was the first African nation to invest in tropical cyclone insurance with ARC Ltd.
• US$10.7m pay out by ARC Ltd. following cyclone Batsirai helped island nation to rebuild

JOHANNESBURG, 27 FEBRUARY 2023 – The unusually protracted journey cyclone Freddy led across the Indian Ocean this past month was a stark reminder of the vulnerability African nations like Madagascar grapple with, in the face of hazards such as tropical cyclones that could worsen with climate change.

As the world watched Freddy travel a vast distance across the South Indian Ocean from the northwest coast of Australia to island nations thousands of miles away, Madagascar braced itself for another battering – just over a year after cyclone Batsirai wreaked havoc, one of four storms that hit the island nation that year.

Moving across Madagascar last week, cyclone Freddy brought with it a storm surge of between one to two metres and 175km per hour winds, according to KinetiCast, an online platform providing global insights on tropical cyclone hazards and impacts.

KinetiCast is run by Kinetic Analysis Corporation, which created the tropical cyclone model for Africa’s premier institution for disaster risk financing on and for the African continent, African Risk Capacity Limited. The real-time-data it produces powers ARC Ltd.’s Tropical Cyclone Explorer and led to a pay out of US$10.7m to Madagascar last year to help the country recover from the effects of cyclone Batsirai.

Kinetic Analysis Corporation’s CEO, Richard Murnane, explains: “We use data generated by official agencies such as the Joint Typhoon Warning Centre and Meteo France La Réunion, among others, to generate a geospatial footprint of the hazards associated with a tropical cyclone – winds, waves, storm surge and rainfall – as well as its impact and damage in terms of populations affected and purchasing power parity losses.”

While cyclone Freddy brought less rain than feared, it flattened rice fields and fruit trees, damaged property, displayed 11,000 people and killed five people.

“In the case of cyclone Freddy, almost two million people in Madagascar were subjected to hurricane-strength winds and over 20,000 were in areas subject to storm surge,” Murnane adds.

Due to its geographical position, Madagascar has borne the brunt of the south-west Indian Ocean cyclone season which runs from November to April. Last year, it brought several storms to the African island nation’s shores including the devastating cyclone Batsirai, tropical storm Ana, tropical storm Dumako and tropical storm Emnati.

Besides the loss of life, these storms bring flooding, wind damage, destruction to property and infrastructure, and landslides. Villages and towns are cut off, people displaced, schools destroyed, and access to clean drinking water, electricity and supplies severely hampered. In the case of Batsirai, some 121 people were killed and 75,000 displaced.

However, Madagascar is covered within ARC Ltd.’s parametric insurance risk-pooling facility – the first African country to have signed up for sovereign parametric cyclone insurance protection since the organisation launched its cyclone product in the second half of 2020. The country took out a policy, fully co-financed by KfW Development Bank and ADRiFi Multi-Donor Trust Fund.

“Based on ARC Ltd.’s tropical cyclone model, we identified that more than six million people were exposed to cyclone Batsirai. Shortly after the cyclone, ARC Ltd. made a pay out of US$10.7m to enable the country to start rebuilding,” says Lesley Ndlovu, CEO ARC Ltd.

“Our parametric insurance triggers ensure rapid deployment so that assistance can reach those who need it most and lives can be saved. Unlike traditional insurance policies, intended to return the insured back into the position they were in prior to an insured event, parametric insurance covers the probability of a predefined event happening instead of indemnifying actual loss incurred.”

Without parametric insurance, vulnerable nations such as Madagascar would be unable to respond swiftly and effectively, to help build back better. ARC Ltd. already has 35 African Union members that have access to its ARC Ltd. risk transfer services.

There are ongoing efforts to ensure that more countries sign up to support this mechanism and endorse it as Africa’s solution to the growing threats of natural disasters.

Ends

For more information about The African Risk Capacity Limited (ARC Ltd), or to arrange an interview, please contact Claire Lathe at claire@bigambitions.co.za.

About ARC Limited

The African Risk Capacity Limited (ARC Ltd) is a financial affiliate of the African Risk Capacity (ARC), a specialised agency of the African Union (AU), an initiative designed to improve current responses to climate-related food security emergencies.

ARC Ltd is a mutual insurance facility comprised of its members, which have included Kenya, Mauritania, Niger, Senegal, Mali, Malawi, Gambia, Burkina Faso, Chad, Zimbabwe, Togo, Madagascar, and Zambia.

The membership also includes its capital contributors who have provided premium subsidies, including USAID, FCDO SWISS, KFW/BMZ, IFAD, AFDB, WFP and STARTNETWORK.

Fitch revises ARC Limited’s Outlook to Positive; affirms IFS Rating at ‘BBB+’

• Fitch rating reflects ARC Limited’s strong capitalisation and good company profile
• ARC Limited’s enhanced development activities likely to increase its importance

JOHANNESBURG, 27 JULY 2022 – Fitch Ratings has revised African Risk Capacity (ARC) Limited’s Outlook to Positive from Stable and has also affirmed its Insurer Financial Strength (IFS) rating at ‘BBB+’ and Long-Term Issuer Default Rating (IDR) at ‘BBB’.

Announcing the news, the credit rating agency commented that this Outlook revision reflects ARC Limited’s “strong progress in meeting its development objectives, which if sustained, could support a stronger company profile assessment within the next two years”.

It added: “In Fitch’s view, the improvement in ARC’s premium base, risk pool and claim pay-outs enhances the company’s geographic diversification, franchise and operating scale. In addition, the improved reach of the company’s development activities is likely to further increase its importance to sponsors.”

Says Lesley Ndlovu, ARC Limited CEO: “We are delighted with this revision of our Outlook to Positive which reflects the work we have done to raise our company profile and improve portfolio diversification.

“We are confident that the support from our sponsors will only grow as we expand ARC Limited’s impact on the African continent in terms of our development activities and the number of parametric insurance pay-outs we have been making in 2022 to respond to cyclones and droughts.”

In addition to its strong growth in gross written premiums (GWP) in 2021, ARC Limited’s support from and oversight by the German development bank KfW through the Federal Ministry for Economic Cooperation and Development (BMZ) and the UK Foreign, Commonwealth & Development Office (FCDO) were cited as reasons for the revision.

ARC Limited’s key strength, adds Fitch, is its capital position. “We regard the returnable capital provided by KfW/BMZ and the FCDO of USD70 million at end-2021 as fully loss-absorbing, and consequently treat it as equity capital when assessing capitalisation and leverage. On this basis, ARC scored ‘Extremely Strong’ on Fitch’s Prism Factor-Based Capital Model based on end-2021 figures, unchanged from 2020. Fitch expects that further capital support could be made available as ARC continues to achieve its development goals.

ARC’s regulatory capitalisation is strong, with a Bermuda enhanced capital requirement ratio of 796% at end-2021 (2020: 1,628%),” it said.

“While our product portfolio is concentrated, dominated mainly by drought insurance, we are actively diversifying this. To that end, we introduced tropical cyclone cover in 2020 and are also expanding our offering to cover outbreak and epidemic, and flooding risks. In addition, we are expanding our insurance offering to non-sovereign entities and working to increase the number of African countries covered in our risk pool which we believe will help to elevate our standing in future Fitch ratings,” Ndlovu concludes.

Ends

For more information about ARC Group, or to arrange an interview, please contact Simon Diouf, Communications Consultant at African Risk Capacity on simonpierre.diouf@arc.int or contact Claire Lathe at claire@bigambitions.co.za.

About ARC Limited

The African Risk Capacity Limited (ARC Ltd) is a financial affiliate of the African Risk Capacity (ARC), a specialised agency of the African Union (AU), an initiative designed to improve current responses to climate-related food security emergencies.

ARC Ltd is a mutual insurance facility comprised of its members, which have included Kenya, Mauritania, Niger, Senegal, Mali, Malawi, Gambia, Burkina Faso, Chad, Zimbabwe, Togo, Madagascar, and Zambia.

The membership also includes its capital contributors who have provided premium subsidies, including USAID, FCDO SWISS, KFW/BMZ, IFAD, AFDB, WFP and STARTNETWORK.