30 million per country per season for drought events that occur with a frequency of 1 in 5 years or less.
African Risk Capacity (ARC) enables participating African governments to insure themselves against natural disasters and respond rapidly when their citizens experience harvest failure. It was established as a Specialized Agency of the African Union (AU) to help member states improve their capacities to better plan, prepare, and respond to extreme weather events, protecting the food security of their vulnerable populations in the process.
ARC is comprised of two entities: the African Risk Capacity Agency and the ARC Insurance Company Limited. Together, they provide ARC Member States with capacity building services and access to state-of-the-art early warning technology, contingency planning, and risk pooling and transfer facilities.
The African Risk Capacity (ARC) Group is comprised of ARC Agency, a Specialised Agency of the African Union founded in 2012; and ARC Insurance Company Limited (ARC Ltd), a hybrid mutual insurer and the commercial affiliate of the Group founded in 2014.
The ARC Agency Governing Board was elected by the Conference of the Parties in Dakar, Senegal on 27 February 2013. The Board is composed of eight members of varying expertise from development economics and risk finance to climate change and food security. Five members and their alternates are elected for staggered terms from Parties that have expressed intent to take out insurance and taking into account geographical representation. One member is appointed by the African Union Commission for expertise in finance or insurance matters. An additional member is appointed by the African Union Commission in consultation with the UN World Food Programme for expertise in disaster management, climate change or food security. The Director General serves as an ex officio member. All members of the ARC Agency Governing Board and their alternates serve in their personal capacities on a part-time basis as required to carry out their functions. The Agency is a cooperative mechanism providing general oversight and supervising development of ARC capacity and services.
Countries wishing to take out contracts for insurance with the African Risk Capacity Insurance Company Limited must hold a Certificate of Good Standing (CGS) with the ARC Agency.