The African Risk Capacity (ARC) Group has approved a $2 million insurance payout to support approximately 45,000 drought-affected households in Somalia.

This initiative is part of ARC’s broader mission to help African nations manage climate-related disasters through parametric insurance, which enables swift financial assistance based on predefined triggers like rainfall deviations.

The funding for ARC’s efforts is bolstered by significant international contributions, including over $100 million from Germany and other key donors that include the United Kingdom, European Union, France, United States, Canada, Switzerland, Sweden, and additional partners.

These collective contributions enhance ARC’s capacity to provide timely financial relief to countries facing climate-induced crises.

In a related development, the United Kingdom’s Foreign, Commonwealth and Development Office announced an additional £7.4 million (approximately $9.63 million) funding to the African Development Bank’s Africa Disaster Risk Financing (ADRiFi) programme.

This commitment aims to strengthen sovereign drought insurance protection, with a particular focus on Somalia over the next three years, facilitating swift payouts to support vulnerable communities during severe droughts.

These collaborative efforts underscore the importance of proactive disaster risk financing in mitigating the impacts of climate change on vulnerable populations in Africa.