African Risk Capacity (ARC)

Climate Objective
Sectors and Themes
Disaster Risk Reduction
Type of Support Provider
Type of Recipient
Public entity at the national level
Fund Size

30 million per country per season for drought events that occur with a frequency of 1 in 5 years or less.

Co-financing Requirement
Trustee or Administrator
Specialized Agency of the African Union
Contact Information
Middle East and North Africa
Sub-Saharan Africa

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.

Support Provider

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.

Purpose of Support
Strengthening enabling environments and stakeholder capacity
Funding Type
Organizational and Decision Making Structure

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.

Eligibility Criteria

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.

Eligible Countries

Member countries of the African Union (AU). See a list of eligible countries here.

Information on how to

Participate in ARC by following steps in the country engagement proccess. Countries must undertake several processes, including customizing the Africa RiskView software, signing a Memorandum of Understanding for in-country capacity building, defining a contingency plan for ARC payouts, and determining risk transfer parameters. When countries have satisfactorily completed this process, they will receive a Certificate of Good Standing from the ARC Agency Governing Board, and will pay a premium to ARC Ltd, after which they will be members of the risk pool. To receive a payout, countries develop Final Implementation Plans that elaborate upon the pre-approved Contingency Plans to facilitate targeted interventions that respond quickly and effectively to the populations impacted by disasters.

Find additional information on the country engagement process here.