A disaster risk insurer that resulted from a specialised agency of the African Union plans to start an insurance cover for outbreaks of diseases such as Ebola in sub-Saharan Africa by 2017.
The African Risk Capacity (ARC) Insurance Company Limited has traditionally focused on providing insurance for victims of disasters, but hopes to add disease outbreak insurance to its services.
Richard Wilcox, ARC’s founding Director-General, says that the current system is not suitable for timely and equitable disbursement of funds when disasters strike, and that with the proposed insurance, African countries will ‘move from managing crises to managing risks, (and) protecting vulnerable populations through early intervention’.
‘Outbreak and epidemic insurance would be priced based on the country’s risk. Similar to slow onset natural disasters like drought, pandemics don’t ‘hit’; they develop over time and there are mitigating measures that can be taken for, which ARC would provide financing before they become pandemics,’ he explains.
Initial funding of around US$300 million is expected to come from donors, but Wilcox believes that it is possible for African countries to sustain the insurance scheme.