In a new annual report for the year ending 2025, African Risk Capacity Limited (ARC Ltd.), the hybrid mutual insurer and financial affiliate of the African Risk Capacity Group, has reported its largest profit since inception of $13.5 million for the year.
The firm stated, “Performance in 2025 reflects measures taken to reinforce underwriting discipline, reestablish portfolio stability and enhance operational efficiency, enabling ARC Ltd. to respond more effectively to the evolving needs of its Member States.”
Additionally, in 2025, there was a 26% year-over-year growth in gross written premium, which hit $48.6 million.
ARC Ltd. made nine payouts in 2025 worth $21.4 million in gross claims paid; the largest contributor to these payouts was drought responses, while cyclone and social protection and inclusive insurance followed closely.
The firm’s net loss ratio was 92%, while operational costs came down by 37%; lastly, its expense ratio was 12%.
Also in 2025, ARC Ltd. started offering flood insurance and strengthened REPAIR, its Multi-layered Climate Disaster Risk Financing Programme, Agriculture Inclusion Insurance Cell with One Acre Fund, Retakaful cell, Climate Disaster Risk Finance Initiative – GSSP grant, and the increased parametric penetration programme – NORAD grant.
David Maslo, CEO, ARC Ltd., said, “We reinforced underwriting discipline, strengthened capital management and intensified cost control while preserving operational delivery. The evolving funding environment reinforced the importance of diversification and financial sustainability. We deepened engagement with partners, strengthened reinsurance relationships and ensured that the sovereign risk pool remained robust.
“At the same time, we continued advancing our mandate. Multi-peril coverage expanded, innovative risk transfer mechanisms progressed and inclusive partnerships broadened participation in climate protection systems.
“Throughout this transition, our commitment to technical integrity and disciplined execution remained constant. Looking ahead, our priorities remain clear: expanding participation within the sovereign pool, strengthening capital resilience, scaling inclusive solutions and deepening integration of insurance within national disaster risk financing strategies.”
Dr. Maxwell M. Mkwezalamba, Chairperson, ARC Ltd., commented, “2025 was a year marked by institutional strengthening, change management and strategic progression, as well as adjustments within a shifting global financing environment. ARC Ltd. navigated these developments with discipline and continuity, maintaining operational focus while reinforcing its strategic direction and organisational resilience.
“The year under review represents a milestone in ARC Ltd.’s institutional development. Premium earnings reached its highest level to date, and the organisation recorded its strongest annual financial result since establishment. These outcomes reflect strengthened underwriting discipline, improved cost management and a more diversified risk pool. They demonstrate that impact and financial sustainability can reinforce one another when supported by sound governance and prudent capital management.
“Beyond financial performance, ARC Ltd. continued to evolve its risk offerings and deepen collaboration with Member States and partners. The expansion of multi-peril solutions and the operationalisation of new initiatives reflect an organisation responding pragmatically to Africa’s evolving climate risk landscape.”
