ARC Replica is run in partnership between Start Network, African Risk Capacity (ARC), African Union Member States, including the Government of Senegal and Zimbabwe, and the World Food Programme. It is funded by the German Federal Ministry for Economic Cooperation and Development (BMZ) through the German Development Bank, Kreditanstalt für Wiederaufbau (KfW) and the UK's Foreign, Development and Commonwealth Office.
ABOUT THE PROGRAMME
African Risk Capacity (ARC) is an organisation mandated by the African Union to help African nations proactively manage climate-related humanitarian risks through macro-insurance. The ARC Replica programme allows non-governmental organisations like Start Network to work side-by-side with governments to manage these risks.
How it works
African Risk Capacity's (ARC) member states can purchase 'parametric' insurance policies from ARC Ltd, which means that payouts are automatically made for pre-approved contingency plans when pre-agreed scientific triggers are met. Non-governmental partners like Start Network can then purchase a replica insurance policy to complement this approach to disaster risk management.
Start Network and the World Food Programme were the first designated partners of the ARC Replica initiative in 2018. Start Network purchased its first ARC Replica policy to protect against drought in Senegal in 2019, alongside the Senegalese government.
CASE STUDY: SENEGAL
Droughts are slow onset disasters. Yet, while it is possible to predict drought months in advance, the response is always reactive rather than proactive. Humanitarian assistance comes too late, often because funding hasn’t been put in place.
In July 2019, Start Network and the government of Senegal each purchased an insurance policy against drought. If rainfall levels dropped below a pre-defined threshold, Start Network members and the government of Senegal would receive payouts to implement timely and coordinated actions to protect communities at risk.
When the pre-agreed triggers were met in November 2019, a payout of US $12.5m was made to the Government of Senegal and another US $10.6m was paid to Start Network. The payout to Start Network remains the largest-ever funding allocation to civil society for early humanitarian action.
Throughout 2020, six Start Network members – Action Against Hunger, Catholic Relief Services, Oxfam, Plan International, Save the Children and World Vision – worked alongside the government of Senegal to deliver assistance to Senegalese families ahead of a severe large-scale drought. The agencies distributed enriched flour and made cash transfers to more than 335,000 people across seven regions. This enabled families to protect livestock and other valuable assets and avoid resorting to ‘negative coping strategies’, such as skipping meals or sending children to work instead of school. The COVID-19 pandemic exacerbated needs and agencies took the opportunity to broadcast hygiene and sanitation messaging to help mitigate the spread of the virus.
Start Network undertook a comprehensive evaluation to review the impact of the payout on the members who received funding and the communities reached. A mixed method approach was taken, including data collection from implementing agencies, government stakeholders, and three rounds of randomised, representative telephone-based surveys with communities.
Thanks to further funding provided by BMZ through KFW, Start Network is now working to purchase a policy in Senegal in 2021, and to expand the programme to other African country such as Zimbabwe.