In its new annual report for the year ending 2025, Africa Risk Capabilities Ltd. (ARC Ltd.), the hybrid mutual insurance and financial affiliate of the Africa Risk Capabilities Group, reported its largest profit since its inception, with a profit of $13.5 million for the year.
“The 2025 results reflect steps taken to strengthen underwriting discipline, rebuild portfolio stability and improve operational efficiencies, allowing ARC Ltd. to respond more effectively to the changing needs of member countries,” the company said.
In addition, total premiums increased by 26% year-on-year in 2025 to US$48.6 million.
ARC Ltd. paid out nine claims in 2025, totaling $21.4 million; the largest contributor to these payouts was drought response, followed closely by hurricane, social protection and inclusion insurance.
The company’s net loss margin was 92%, operating costs fell 37%; finally, its expense ratio was 12%.
Also in 2025, ARC Ltd. started offering flood insurance and enhanced REPAIR, its multi-tiered Climate Disaster Risk Financing Program, the One Acre Fund’s Agricultural Inclusion Insurance Unit, the Retakaful Unit, the Climate Disaster Risk Financing Program – GSSP Grant, and the Improving Parameter Penetration Program – NORAD Grant.
David Maslo, CEO of ARC Ltd., said: “We have strengthened underwriting discipline, strengthened capital management and strengthened cost controls while maintaining operational delivery. The changing financing environment has reinforced the importance of diversification and financial sustainability. We have deepened our engagement with partners, strengthened reinsurance relationships and ensured that the sovereign risk pool remains strong.
“At the same time, we continue to advance our mission. Multihazard coverage expands, innovative risk transfer mechanisms make progress, and inclusive partnerships expand participation in the climate protection system.
“Throughout the transition, our commitment to technical integrity and rigorous execution has remained consistent. Going forward, our priorities remain clear: expanding participation in sovereign pools, increasing capital resilience, expanding inclusive solutions and deepening the integration of insurance into national disaster risk financing strategies.”
Dr. Maxwell M. Mkwezalamba, Chairman of ARC Ltd., commented: “2025 has been a year of institutional strengthening, change management and strategic progress, and adjustment in the changing global financing environment. ARC Ltd. has guided these developments with discipline and continuity, maintaining operational focus while strengthening its strategic direction and organizational resilience.
“The year in review was a milestone in the growth of the ARC Ltd. organization. Premium income reached its highest level to date and the organization recorded its strongest annual financial performance since its inception. These results reflect increased underwriting discipline, improved cost management and a more diversified risk pool. They demonstrate that impact and financial sustainability can go hand in hand, supported by sound governance and prudent capital management.
“In addition to financial results, ARC Ltd. continues to develop its risk offerings and deepen its engagement with member states and partners. The expansion of multi-risk solutions and the implementation of new initiatives reflect the organization’s pragmatic response to Africa’s changing climate risk landscape.”
