HEALTH : OUTREAK AND EPIDEMIC RISK
Outbreaks of infectious diseases, such as cholera, Ebola, COVID-19, or dengue, can escalate rapidly and overwhelm national health systems. In Africa, the delay between outbreak detection and funding mobilisation often hampers containment efforts, increasing human and economic losses. Traditional funding mechanisms are reactive and slow, leaving countries exposed during the critical early stages of an epidemic.
How ARC Ltd’s Parametric Risk Transfer Works
To address these challenges, ARC Ltd developed the Outbreaks & Epidemics (O&E) parametric insurance product, providing governments with predictable and timely funding for epidemic response:
- Pre-agreed triggers: The product is based on pre-defined parameters such as case growth rates, geographical spread, or epidemiological thresholds. Once a threshold is crossed, a payout is triggered—without needing lengthy verification or assessments.
- Response readiness: Countries participating in the O&E product develop preparedness and response plans aligned with national public health protocols and WHO guidance. Funds can be rapidly deployed for surveillance, isolation, community engagement, and medical care.
- Technical collaboration: The O&E programme is developed in partnership with public health institutions, ensuring scientific rigour and alignment with global standards.
Concrete Use Cases
SENEGAL AND UGANDA – PIONEERS IN EPIDEMIC RISK FINANCING
Senegal and Uganda were the first two countries to participate in the ARC O&E pilot. Working with ARC and international experts, they:
- Developed tailored outbreak risk profiles for diseases such as cholera and Ebola
- Defined case-based triggers for activation
- Finalised epidemic contingency plans, covering testing, treatment, and communication
These countries now have financial instruments in place to respond rapidly to future outbreaks, reducing the risk of widespread contagion.