MALI – The government of Mali has secured US$7.1 million in climate risk insurance pay-out by African Risk Capacity (ARC).
The funds channelled to the United Nations World Food Program (WFP) are aimed at providing emergency and resilience-building support to populations vulnerable to the impacts of climate-change-induced disasters.
ARC is an innovative approach to climate risk management that allows countries to extend their climate insurance coverage to more vulnerable people in their countries.
The program is established to help governments improve their capacities to plan, prepare and respond to natural disasters caused by extreme weather events.
“Collaboration between ARC, our Replica Partners, and Governments shows how private and public sector can come together to solve the pressing problems the continent faces,” said Malvern Chirume, ARC Limited Chief Underwriting Officer.
In 2021, Mali experienced the most severe lack of rains in five years caused by periodic dry spells and low rainfall, putting 1.9 million people across the country at risk of severe food insecurity.
The impacts of drought have been particularly exacerbated by 10 years of conflict and COVID-19.
“Having a plan increases dramatically the speed of execution because at a point the government received the funding, it already has a plan on how to disburse this,” said Lesley Ndlovu, CEO ARC Limited.
“We work with member states to provide disaster risk insurance to promote resilience and provide financial protection for the vulnerable population when perils, such as the Mali drought, occur.”
The government of Mali and its Replica partner, the WFP, have established a joint response plan to manage and prevent food insecurity and malnutrition caused by the drought.
WFP, an ARC-Replica technical partner has been subscribing to the climate insurance policy in Mali since 2017 to finance an early emergency response.
In 2021, WFP’s insurance premium was funded by the United States Agency for International Development (USAID) and the Government of Germany.
WFP will use climate insurance to provide early food assistance through cash transfers to 161,000 women, men, and children affected by climate shocks.
Over 20,000 children aged from 6 to 23 months, and pregnant women and breastfeeding mothers will receive nutritional support and services.
To reinforce communities’ resilience to climate shocks, 23,000 people will benefit from community asset-building programs.