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Mar 2024

UN partners with African Risk Capacity to boost climate insurance coverage

Source: Middle East Insurance Review | Mar 2018

The African Risk Capacity (ARC), an agency of the African Union (AU), and the United Nations Economic Commission for Africa (ECA) have entered into a new partnership to increase insurance coverage for climate risks for African states.
 
   The multilateral deal was announced at the AU’s Annual Summit in Addis Ababa, and commits ARC and ECA to build the capacity of their 33 common member states by embedding risk-management investments into government planning through policy development. 
 
   Both ARC and ECA also will share expertise and commit financial resources to joint analytical work in economic and climate risk research to promote risk-transfer instruments.
 
   The UN estimates that Africa will see the adaptation costs of climate change rise to US$50 billion per year by 2050.
 
   “This partnership marks a bold new phase of heightened collaboration on combatting the effects of climate change in Africa,” said Mr Mohamed Béavogui, Director-General of ARC Agency. “The future of disaster risk management is an increasingly urgent economic issue, and ECA’s unique expertise will complement ARC’s work in serving its member states and building preparedness and resilience on the continent,” he said.
 
   In the four years that ARC has offered insurance to its member states, it paid out more than $34 million to member states affected by drought events. These resources have assisted over two million people affected by climate disaster.
 
   “Climate change is one of the biggest threats to Africa’s economic and social development,” said ECA Executive Secretary Vera Songwe. “We believe that efforts like our partnership with ARC will help move the needle, so that African countries can be well-guarded against these threats, and they can thrive.” M 
 
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