By RISQ Consulting
If everyone had Liam Neeson’s special set of skills from the Taken series, there would be no need for kidnap and ransom (K&R) insurance. Unfortunately, K&R scenarios are a real-world possibility for many high-profile executives and individuals traveling abroad.
What is Covered
K&R policies cannot prevent an abduction or pay ransom directly, instead they are indemnity clauses which reimburse you for costs related to kidnapping. Common reimbursement claims include:
- Ransom monies paid or lost as a result of kidnapping.
- Money lost due to destruction, theft, or confiscation in delivery or transit.
- Accidental death and injury sustained during a kidnapping as well as medical and psychiatric care.
- Liability judgments brought against the victim.
- Severe disruption of business operations and damage to company brand.
- Salary replacement, relocation, and job retraining.
Many policies include provisions for crisis management consultants who advise on incident response or prevention and reaction training for insured individuals.
Who Needs K&R Insurance Coverage
The most commonly targeted individuals include high-net worth and high-profile executives, celebrities, strategic decision makers, and people with ties to them including family members and employees.
Missionaries, volunteers, and reporters working in volatile areas may also be targets as a result of political and public reactions surrounding their capture.
Susceptible Locations for Kidnapping Occurrences
Policies are generally written to cover specific trips. Fees and coverage are based on individual factors including the insured’s country of residence, region and length of travel, revenue, and industry.
Mexico, Venezuela, Haiti, Nigeria, certain countries in Latin America, parts of the Russian Federation, Eastern Europe, and Central Asia, particularly Afghanistan and Iraq, are commonly named K&R policies.
The U.S. Department of State maintains a list of travel advisories worldwide (https://travel.state.gov/content/travel/en/traveladvisories/traveladvisories.html/) which specifically highlights dangerous regions.