Kidnap and ransom (K&R) insurance is not typically the first type of coverage that comes to mind when considering business insurance. However, for certain individuals and companies, this safeguard can be just as crucial as other forms of business insurance. Because of the complex nature of this type of policy, it is important to understand how it works.
What is Kidnap and Ransom Insurance?
Crimes like kidnapping for ransom and extortion are major international concerns, as they can be very lucrative for the perpetrators. K&R insurance protects you and your business from the financial devastation of kidnapping, ransom, extortion, hijacking, or wrongful detention. This coverage provides reimbursements for any monetary losses resulting from the above dangerous situations.
Who needs this coverage?
K&R insurance applies to companies, as well as affluent individuals such as business owners and their families. Any organization that has operations abroad is vulnerable to these crimes. Companies, charities, and NGOs with employees that travel abroad frequently, especially to countries with high kidnapping rates, should consider purchasing this coverage. The most targeted demographic is high-net-worth individuals.
What does it cover?
K&R insurance works uniquely compared to other policies. Because these policies deal with fragile and dangerous situations, the money is usually paid to the perpetrators first, and later reimbursed by the insurance company. The main priority is meeting demands and following directions to ensure no one gets hurt and a safe evacuation can be provided. Consequently, the money should be paid out of pocket first, or with a loan. This insurance will reimburse the client and cover the loan interest. Medical care and travel expenses are also covered.
Situational Examples
- An employee overseas requires an emergency evacuation due to a rapidly declining political situation.
- The spouse of a powerful CEO is kidnapped while traveling in another country.
- A previous employee threatens your company with violence.
- A board member of a large corporation is illegally detained abroad.
Why Callahan Risk?
Because of our long-standing relationships with carriers and vendors, we can ensure your K&R policy is tailored to you and your business. Our experience qualifies us to provide you with the right coverage to protect your family and business without suffering financial devastation. Contact Callahan Risk today with any inquiries regarding K&R insurance.
