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Social enterprise mitigates loss caused by shack fires


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The Covid-19 pandemic had caused health and economic disasters across the country, affecting South Africa’s most vulnerable communities, who face yet another crisis during winter: shack fires across informal settlements. These are accompanied by trauma, anxiety and uncertainty.


                        Social enterprise mitigates loss caused by shack fires


Restoring homes and livelihoods with little income or savings after a devastating fire is always difficult – but current circumstances will make it even harder over the next few months to rebuild their lives.

It is imperative that there is protection for disadvantaged communities – and even more so in these challenging times. There’s a need for major improvements in home safety and security, and for access to innovative low-cost financial services that can be sustained in times of crisis.

Low-cost home insurance can mean the difference between families being able to quickly get back on their feet after a shack fire or being left homeless – and this is exactly the type of affordable protection provided by award-winning social enterprise Lumkani and underwritten by Hollard.

Reducing the risk

Lumkani’s mission is to mitigate the loss of life and property caused by shack fires in South Africa and across the world by offering protection to individuals who do not qualify for traditional household insurance.

Francois Petousis, the organisation’s head of product and director of humanitarian projects, explains its first-of-a-kind approach to shack fires as follows: “We do this in two ways: by providing innovative risk-reducing hardware solutions, designed specifically for these communities, and by developing and distributing affordable financial products to allow people to rebuild after disaster strikes, breaking the cycles of poverty common in these environments.”

The difference the enterprise’s low-cost home-insurance product makes was highlighted on 16 May 2020, when a single shack fire tragically destroyed at least 10 homes in the informal settlement of Masiphumelele near Noordhoek, Cape Town.

Five of the affected families were protected by Lumkani cover, which enabled them to rebuild their homes speedily, ensuring a roof over their heads and #BetterFutures. Sadly, those families not insured were left to reconstruct their lives without the benefit of cover, facing not only the coronavirus threat that is rapidly spreading in such communities but also harsh economic realities.

Petousis says Lumkani provides access to protection “without needing to rely on external actors to fund activities to build resilience of people’s shelters and communities”.

More than 16 humanitarian and other organisations worldwide have funded Lumkani to enable the organisation to deploy its technology. This is testament to the positive impact of its detection systems and highlights the immense need associated with fires in informal settlements across the world.


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