Africa Finance Corporation launches $30m captive insurance subsidiary

The Africa Finance Corporation (AFC) has established AFC Captive Insurance Company Ltd, a wholly owned subsidiary incorporated in Bermuda and licensed as a Class 2 insurer. Backed by up to $30 million in equity capital, the new entity is designed to enhance the corporation’s risk management capabilities and improve capital efficiency for infrastructure financing across Africa.

Initially, the captive insurer will provide coverage for loans extended by the AFC to its counterparties, allowing the corporation to manage and retain a greater proportion of its financing risks rather than relying on external commercial insurance markets. The company is structured to eventually expand its services, with up to 20 percent of its underwriting capacity available to AFC affiliates and selected third-party businesses.

AFC President and CEO Samaila Zubairu stated that the initiative aims to address Africa’s infrastructure needs through innovative approaches that mobilize additional capital. The move leverages the AFC’s strong credit standing, including an A3 rating from Moody’s and an ‘A’ rating from S&P Global, to build an investment-grade profile for the new insurance platform.