Kidnap and ransom insurance

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If you have not purchased kidnap and ransom insurance before, and want to learn more about this type of insurance, our frequently asked questions maybe of interest.

What is kidnap and ransom insurance?

As the name suggests, kidnap and ransom insurance (sometimes called kidnap for ransom or k&r insurance) provides protection for individuals against kidnapping and ransom.

Kidnap and ransom insurance also provides protection against a much broader range of threats including extortion, hijack, political kidnapping and detention, threats, disappearance, hostage crisis situations, assault, child abduction, express and virtual kidnap, political evacuation, and stalking.

There are two key elements to kidnap for ransom insurance policies:

  • A crisis response and assistance element where world-leading crisis responders will be called on to resolve the incident.
  • A financial aspect covering costs incurred in the event of a security related incident.

Policies can be bought on an annual basis, for key projects, or on a multi-year policy basis and each policy is tailored to the client’s requirements and their exposures.

Does my organisation need kidnap and ransom insurance coverage?

We work with organisations of all sizes including small businesses, multinational corporations, not for profit organisations, and charities. These organisations either:

  • have an international presence, this could be premises overseas or projects in other countries.
  • send members of staff overseas, either on one-off trips or on a regular basis.
  • have already experienced a security incident and are looking for further protection for their brand and their people.

Kidnap and ransom policies are now seen as good corporate governance and a necessary duty of care mechanism for employees based overseas or travelling. For most organisations, these policies add bench-strength to an existing risk management framework or operate in lieu of an in-house team where a client does not have budget for one.

When is kidnap and ransom insurance required for individuals?

Kidnap and ransom insurance should be considered in both business and personal contexts:

  • From a business perspective, k&r insurance is essential for individuals who are travelling to, or operating in, challenging or complex environments. In those instances, organisations have a duty of care to keep their staff safe and k&r insurance should be a key element of overall duty of care policies and procedures.
  • For individuals working on a contractual basis, it is important to fully understand your employer’s k&r policies and whether you are covered under a company scheme or need to take out your own policy on an individual basis.
  • In a personal context, all families who have certain levels of wealth or exposure should consider a k&r policy to protect them from malicious actors. This would include protecting children attending academic institutions overseas, or indeed those travelling on a year abroad. In today’s security climate, families are even buying this product for holidays to areas which are in close proximity to locations of conflict.

What is covered by kidnap and ransom insurance?

Kidnap and ransom insurance can cover a multitude of perils including, but not limited to kidnap, extortion, hijack, disappearance, wrongful detention, express kidnap, and threat. It covers the services of world-class crisis responders who can support individuals on the ground wherever they are in the world. This also includes emergency response – if and when this is required.

Financially, kidnap for ransom insurance covers ransom reimbursement, all additional costs, legal liability and costs in relation to personal injury or death, in addition to unlimited crisis response expenses. Policies also offer PR and communications support, as well as diplomatic channels to expedite the safe and timely resolution of an incident.

What is not covered by kidnap and ransom insurance?

While kidnap and ransom policies are very comprehensive, there are some exclusions or areas that are not covered that buyers should be aware of.

Kidnap for ransom policies do not include cover for criminal or fraudulent activity perpetrated by the insured, e.g. carrying out a bogus kidnapping scenario. In some territories, kidnap for ransom policies are subject to sanctions which prohibit claims payments being made. In other areas, the activities of certain proscribed groups will not be covered.

What additional services can kidnap and ransom insurance policies provide?

As well as covering financial losses resulting from a security incident, kidnap for ransom insurance policies also cover the services of world-leading crisis responders who can be called on to resolve an incident in almost any jurisdiction globally.

These teams of response advisors are highly trained in crisis management and hold vast databases of incidents around the world. This allows them to understand the political landscape as well as the motivations of the key perpetrators. There is no limit to the number of advisors who will be deployed to manage an incident. This could be to the company HQ, to the family home and indeed to the area of the incident.

The response teams tend to be based in the UK with hand-holders based in hot spots globally who manage the incident in the first 24 hours. A senior advisor will then deploy within that 24 hours to take over the management of the case.

What are the different policy options / types of kidnap and ransom insurance?

Kidnap and ransom insurance can be tailored to a client’s specific needs and requirements.

Kidnap for ransom insurance policies can be taken out on a single trip, project, annual, or multi-year basis. Policies can be taken out on an individual basis or covering any number of insured persons across multiple jurisdictions. Limits can extend anywhere from USD 250,000 up to USD 50m.

When choosing what limit to insure a family for, we take a close look at their business operations and their asset base. We also take into account whether the family has, or is about to, suffer a threat of any kind and then build limits around these factors.

What are the pricing factors involved?

The pricing of a kidnap and ransom policy is predicated on the number of people to be covered, what they are doing, where they are operating, what security measures are employed, and whether the company or policy holder has suffered any previous threats or incidents.

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