Africa Faces Rising Natural Disasters, Seeks Innovative Insurance Solutions
Only 40% of Africa is currently covered by early warning systems, often compromised by quality issues.
ADDIS ABABA, Ethiopia — A new white paper reveals the escalating impact of weather-related natural disasters across Africa, highlighting the urgent need for improved risk management and insurance solutions, writes Winston Mwale.
The report, released by the African Risk Capacity (ARC) Group, documents 1,436 disaster events in 29 African countries between 2000 and 2023.
Floods accounted for 66% of these incidents, followed by storms at 15.4% and droughts at 11.7%.
Despite their lower frequency, droughts had the most significant impact on populations. In 2014, just five drought events affected over 25 million people, while 20 flood events impacted less than 1 million.
African governments spent an estimated $2.2 billion managing weather-related disasters in 2023 alone.
The total economic loss for the continent reached $8 billion, with events like Storm Daniel in Libya and Cyclone Freddy in Mozambique causing billions in damages.
The report emphasizes the disproportionate effect on women and highlights the critical need for gender-inclusive disaster management strategies.
Only 40% of Africa is currently covered by early warning systems, often compromised by quality issues.
The UN estimates that investing in these systems could yield a tenfold return, with even 24 hours' notice potentially reducing damage by 30%.
In response to these challenges, the ARC has expanded its insurance offerings.
The number of insured countries has grown from four in 2014 to 24 in 2023, with insured value increasing from $129 million to $186 million.
ARC launched an Outbreaks and Epidemics program in 2022, covering diseases like Ebola and meningitis.
The organization has paid out over $125 million in insurance claims since 2014, supporting vulnerable communities across the continent.
Despite progress, many African nations still allocate less than 0.5% of their GDP to disaster risk management, underscoring the need for continued international support and innovative financial solutions to build resilience against the growing threat of climate-related disasters.
*Download the white paper below:
