MIGRATION & REFUGEES
Climate and disaster events are increasingly driving internal displacement and cross-border migration in Africa. Cyclones, floods, and droughts can destroy homes, disrupt livelihoods, and force communities to relocate. This places sudden pressure on host communities, refugee camps, and humanitarian systems, often overwhelming available resources.
How ARC Ltd’s Parametric Risk Transfer Works
Parametric insurance can play a role in managing displacement-related risks by ensuring rapid funding for both immediate relief and early recovery:
- Sovereign coverage for displacement response – Payouts can fund emergency shelter, food, water, and health services for displaced populations.
- Replica coverage for humanitarian agencies – Humanitarian partners can trigger pre-agreed contingency plans to assist both refugees and host communities.
- Potential for migration-sensitive triggers – Future products could link hazard data with displacement forecasts to release funds as population movement thresholds are reached.
Concrete Use Cases
Drought-Induced Displacement – Somalia & Neighbouring States
While not yet covered by a migration-specific policy, past ARC drought payouts to governments and partners have indirectly supported displaced households, funding food and cash assistance that allowed them to stabilise without further migration.