Introduction to Kidnap and Ransom Insurance

Kidnap and ransom insurance can be a lifesaver for anyone traveling outside the U.S. In recent years, there has been a rapid increase in kidnappings, requests for ransom, extortion and hijacking worldwide. Around 30,000 kidnappings occur across the globe every year and many of them go unreported. It is extremely important to protect yourself, your family or your business by purchasing kidnap and ransom insurance for international excursions.

Eligibility and Purchase of Kidnap and Ransom Insurance

In order to be eligible for purchase, you must have a U.S. address and should be traveling outside the U.S. You should apply for the insurance about a week before your scheduled trip as underwriting needs some time to review your specific needs.

You or your employer (depending upon who is purchasing the insurance) must have the assets of at least $250,000 to purchase kidnap and ransom insurance.

Your privacy is of the utmost importance and will be protected. The insurance company will not write the name of the insured person on the policy; instead, it will just write a code name and number, which is used to reference the actual insured person in the insurance company's database only.

As an insured person, you should not openly discuss or disclose to anyone the existence of your kidnap and ransom insurance policy in the event that someone is tempted to extort you or kidnap you for ransom.

If a company is buying the insurance for their employees, they should not tell the covered employee about the policy to maintain secrecy of its existence.

An individual, such as a wealthy businessperson, celebrity, actor, musician, politician, sportsman, or anyone with enough net worth that is likely to be a victim of kidnapping, extortion, detention or hijacking can purchase kidnap and ransom insurance.

Kidnap and Ransom Insurance Covered Benefits

Kidnap and ransom insurance covers the ransom amount (up to the policy limit) in case of kidnapping. The insurance company will also pay for additional expenses incurred such as private negotiator, reward payments, recording equipment, security coverage for other family member, and travel expenses.

Once the victim has been released, there may be other expenses or consequences, such as psychiatric or rehabilitation expenses. The insurance company provides coverage for financial losses, loss of income, and asset protection. In case of death during a kidnapping, it can also pay for personal accident and funeral events.

A corporation that purchases a policy for employees might need additional coverages in case of a lawsuit against the company generated by the kidnapped employee, the employee's salary, potential damage to company brand, public relations counsel, relocation and job training.

How Kidnap and Ransom Insurance Works

Most kidnappers warn their victims family or employer against contacting the police or other authorities and the insurance companies understand that, they allow you to wait until you feel safe before informing the insurance company.

Once you contact the insurance company, they can provide expert negotiators and specialists to assist with the kidnapped individuals' release. In addition to negotiating with the kidnappers, there might be other help required such as delivery of ransom, as well security of other family members child care needs.

The insurance company does not make a direct payment to the kidnapper; you must pay out of your pocket first and then file for reimbursement. Some may need to take out a loan and/or sell assets. If the demanded ransom amount is beyond the policy amount, you will have to bear the difference yourself.

It is possible to lose the ransom money due to confiscation, destruction, disappearance, or wrongful appropriation. The insurance company can also help you deal with that.

Conclusion

Kidnap and ransom insurance can help protect individuals and corporations against financial losses resulting from kidnapping, extortion, hijacking, and demands for ransom. It is especially important if you are traveling to high threat countries like Mexico, Colombia, other Central and South American countries, the Middle East, parts of Asia, and parts of Africa. Anyone worth anything is a potential victim, be sure to purchase kidnap and ransom insurance when preparing for your trips abroad.

• Kidnap, Ransom and Extortion Insurance

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