Lagos State pioneers Africa’s first flood risk insurance for vulnerable communities

Lagos State has achieved a continental milestone with the official launch of the Flood Risk Insurance Policy, making it the first subnational government in Africa to implement such a climate-resilience scheme.

The policy is designed to provide immediate financial relief to vulnerable residents in high-risk areas following major flood events.

Speaking at the launch in Victoria Island, Governor Babajide Sanwo-Olu, represented by the Secretary to the State Government, Barr. Abimbola Salu-Hundeyin, described the initiative as a proactive transition from reactive disaster relief to a structured risk management system.

The scheme is set to cover over four million residents across seven high-risk Local Government Areas: Alimosho, Ajeromi-Ifelodun, Amuwo-Odofin, Apapa, Kosofe, Ojo, and Somolu.

Under the terms of the policy, the state can access payouts of up to $7.5 million per flood event.

Beneficiaries are not required to pay premiums or undergo complex application processes; instead, the government utilizes existing social registers, such as the Lagos State Residents Registration Agency (LASSRA), to identify and support those in need.

Speaking, Lagos Commissioner for Finance, Mr. Abayomi Oluyomi, emphasized that climate inaction could cost Lagos up to $40 billion by 2050.

He explained that the insurance acts as a fiscal buffer, allowing the state to recover efficiently without straining the annual budget.

The project was born from engagements at COP27 and is supported by a significant partnership with the German Government through the InsuResilience Solutions Fund, which covers 90% of the first-year premium.

Dr. Oreoluwa Finnih, Special Adviser on Sustainable Development Goals, noted that the scheme employs satellite technology to ensure objective and transparent payouts.

The policy covers pluvial, fluvial, and coastal flooding, and will be integrated into the operational framework of the Lagos State Emergency Management Agency (LASEMA) to ensure targeted assistance for both household relief and the restoration of vital public infrastructure.