Scaling Up Parametric Flood Insurance at the Sub-National Level in Kenya

Kenya is highly vulnerable to extreme weather events, with floods posing a significant and recurrent threat. In 2023 alone, the banks of the Tana River overflowed, displacing over 50,000 residents in Tana River County. These floods bring wide-ranging consequences, including the destruction of homes, agricultural losses, property damage, impassable roads, and the loss of both human and animal lives. Low-income, predominantly Muslim and women-led households are among the most affected, with limited access to protective financial mechanisms.

To address these challenges, the InsuResilience Solutions Fund (ISF) is supporting a collaborative initiative led by Britam General Insurance Ltd, alongside Arid Lands Development Focus (ALDEF) on the demand side and Zambian insurance consultancy Risk Shield on the supply side. The project aims to scale up an index-based flood insurance solution to reach 20,000 vulnerable households in Tana River County.

The initiative builds on a successful pilot launched by Britam, which assessed community demand, flood risk exposure, and the feasibility of index-based flood insurance in the region. The payout from the pilot claims demonstrated the potential for insurance to enhance recovery and resilience among affected households. This success led to a formal partnership between Britam and the Tana River County Government to expand the programme’s reach and impact.

The insurance product uses satellite-based rainfall data and river-gauge measurements to monitor and trigger payouts for flood events. It is designed to provide timely financial relief when critical thresholds are exceeded. The coverage will be bundled with a mobile-based early warning system that leverages existing infrastructure and local women’s groups to deliver timely flood alerts and support proactive risk management.

ALDEF will play a central role in identifying suitable implementation regions, facilitating community engagement, and ensuring adherence to safe programming standards. On the technical side, Risk Shield will support the development and refinement of the insurance model, including product design and risk modelling, while Britam will act as the lead insurer and ensure regulatory compliance.

By scaling up access to tailored climate risk insurance, this initiative aims to protect the livelihoods of the most vulnerable, support faster recovery from flood events, and promote long-term resilience in Tana River County. It also marks an important step in expanding inclusive financial protection for climate-affected communities in Kenya, contributing to broader national efforts in disaster risk reduction and climate adaptation.