The African Development Bank has unveiled a groundbreaking initiative, the Africa Climate Risk Insurance Facility for Adaptation (ACRIFA), aimed at fortifying African countries against catastrophic weather-related events.
This transformative facility, hosted by the Bank, expands upon the Africa Disaster Risk Insurance Program by developing insurance solutions to empower African nations, particularly their agricultural sectors, to prepare for, adapt to, and bolster resilience against the adverse impacts of climate change, including flooding and drought.
Dr. Akinwumi Adesina, President of the African Development Bank Group, introduced this innovative adaptation facility during a side event at the Africa Climate Summit in Nairobi.
ACRIFA is set to mobilise an initial $1 billion of concessionary high-risk capital and grants to catalyse the development and adoption of insurance solutions that aid countries, businesses, and communities in adapting to climate change.
President Adesina emphasised the facility’s mission, stating, “This is our effort to scale up support to insure countries and households against extreme weather patterns, which negatively impact the livelihoods of millions of African farmers, with the majority being women. One way we can address this issue is by ensuring that farmers have access to crop and livestock insurance.”
The Africa Climate Risk Insurance Facility for Adaptation will also extend credit insurance to investment portfolios linked to climate, agri-food systems, and enterprise development.
It will collaborate with primary insurers across Africa to ensure that business opportunities are channeled through them to continental and international re-insurers. Additionally, it will assist national governments in more efficiently managing climate disasters.
Comoros President Azali Assoumani, Chair of the African Union, praised the initiative as a much-needed innovation, given the increasing frequency and impact of natural disasters in African countries.
He highlighted the importance of ACRIFA for strengthening adaptation and resilience capacities, particularly in nations vulnerable to climate change-induced challenges.
Ibrahima Diong, Director General of the African Risk Capacity Group and United Nations Assistant Secretary-General, emphasised the facility’s role in building data to enhance early warning systems in Africa.
ACRIFA’s potential to expand insurance coverage to farmers received endorsement from Martin Frick of the World Food Programme, who noted that it would unlock private sector capital and foster trust in the market.
In closing remarks, Dr. Beth Dunford, African Development Bank Vice President for Agriculture, Human, and Social Development, stressed the urgency of translating this initiative into action.
She emphasised that a thriving climate insurance industry in Africa is not just about policies but about improving lives and enabling Africa to thrive amidst climate uncertainties.
