By: The African Insurance Organisation (AIO)

Africa Insurance Pulse 2025, launched today at the 51st Conference and Annual General Assembly of the African Insurance Organisation (AIO) in Addis Ababa, Ethiopia, underscores the vital role of multi-stakeholder collaboration –particularly with the re/insurance sector as a key enabler – in driving the massive infrastructure investment needed to support Africa’s economic transformation, social inclusion and climate resilience. Developed through in-depth research and interviews with re/insurance executives, the report offers clear recommendations for governments, regulators, investors, project sponsors and re/insurance practitioners. It highlights how the insurance industry can mobilise capital, de-risk investments and safeguard infrastructure assets across their full lifecycle, positioning it as a critical force at the intersection of finance, development and risk management.

Jean Baptiste Ntukamazina, Secretary General of the AIO, commented: "With a rapidly growing population and accelerating urbanisation, Africa faces an urgent need for expanded and resilient infrastructure. The AIO is proud to highlight that re/insurers have a crucial role to play in bridging this gap – as providers of advisory and risk mitigation solutions to mobilise investment flows and protect infrastructure over its full lifecycle, and as long-term institutional investors. Stakeholder collaborations, risk sharing, diversification and enhanced data and analytics capabilities are all focus areas to increasing the sector’s involvement to foster growth, resilience and inclusion across Africa’s evolving development landscape."

Mobilising capital for to bridge Africa’s infrastructure deficit

Reliable infrastructure – ranging from energy grids and transport corridors to water systems, digital connectivity and healthcare – is vital to Africa’s economic productivity, social inclusion and climate resilience. Yet the continent has a huge infrastructure shortfall and infrastructure financing deficit. For example, only 43% of Africa’s population has access to all-season roads, 50.7% of Sub-Saharan Africans lack electricity access, and infrastructure inequality between urban and rural areas remains significant. These shortfalls hinder intra-African trade, raise production and logistics costs, and leave communities vulnerable to economic and climate-related shocks. and According to the African Development Bank, Africa needs USD 495.6 billion annually to meet the Sustainable Development Goals (SDGs) by 2030, and USD 86.7 billion annually to advance African Union’s Agenda 2063 – both of which are dominated by infrastructure needs – and it estimates that the financing gap for these targets stands at a staggering 81% of the total need.

Domestic public funding is constrained by limited revenues and high debt servicing costs. While fiscal reforms are essential, they face considerable hurdles. To accelerate infrastructure development, Africa must urgently further mobilise alternative financing sources, alongside boosting donor inflows and concessional financing to help reduce debt vulnerabilities. However, unlocking investor capital hinges on effective risk mitigation. Africa’s infrastructure investment environment is shaped by complex risk factors, including political and economic instability, regulatory uncertainty, insufficient data, lack of

transparency, weak cross-border coordination, and in some cases inadequate project preparation. These risks drive up capital costs and deter long-term investment.

This is where the re/insurance sector plays a pivotal role. As risk experts with strong credit ratings and specialised solutions – such as performance guarantees and coverage against property, liability, credit and political risks – re/insurers help to de-risk infrastructure investments and protect assets across their lifecycle. Moreover, insurers with long-term liabilities are increasingly aligning with the low-carbon transition and represent a significant, largely untapped pool of institutional capital. With the right frameworks, they can become powerful enablers of resilient, sustainable infrastructure across Africa.

Call to action for all stakeholders

The report finds that bridging Africa’s infrastructure gap requires cross-sector collaboration and coordinated actions by all stakeholders.

For example, for governments and regulators, key recommendations include implementing reforms to foster a stable macroeconomic environment, promoting intra-Africa coordination, involving re/insurers early-on in projects to benefit from the sector’s extensive risk expertise, promoting public-private partnerships and blended financing structures, and enabling innovative risk mitigation solutions and risk-sharing initiatives. The report also emphasises the need to foster efficient, liquid domestic capital markets to mobilise domestic capital and reduce currency risk and external debt, including by recognising infrastructure as a unique asset class and reducing capital charges for infrastructure assets.

Institutions such as Africa Re, the African Trade Insurance Agency (ATI) and various regional risk pools are already making meaningful progress in supporting Africa’s infrastructure development. However, broader participation across the insurance sector is urgently needed to expand these efforts and build a continent-wide risk resilience framework.

Recommendations to the insurance sector include developing Africa-wide shared risk databases and investing in data, advanced technology and analytics, climate risk and catastrophe models, and underwriting and risk management tools to improve risk assessment and pricing accuracy, reduce high risk perceptions, and better manage exposures. Further recommendations include seeking domestic and international risk sharing solutions to strengthen underwriting capacity, promoting skills sharing across Africa, considering portfolio diversification across infrastructure categories and geographies, and, given that infrastructure risk has often been profitable for African re/insurers, sharing success stories.

The full report is available on the AIO website. The report features exclusive interviews with leaders from Africa Re, AfricaDev Consulting, AM Best, Compagnie Centrale de Réassurance, Rift Partners and SanlamAllianz, offering firsthand perspectives on how re/insurance can unlock Africa’s infrastructure potential