In today’s world, U.S. companies face the very real threat of kidnap and extortion. These illegal acts have become business as usual in certain parts of the globe where law enforcement has turned a blind eye to crime, particularly in impoverished areas. In a majority of cases, business travelers are typically kidnapped and held for ransom until a profitable demand has been met.
With overseas business relations becoming more commonplace, the necessity for kidnap and random coverage is growing. Let’s take a closer look at how can you better protect your business with K&R insurance.
What is K&R Insurance?
A stand-alone K&R policy covers costs relating to:
- Kidnap and ransom – abducting an employee in order to demand money for their return.
- Wrongful detention – holding an employee under a governmental guise.
- Extortion – threatening to kill or injure an employee, leak private information, damage goods or property, or deliver a computer virus in exchange for money.
- Hijacking – detaining an employee for a significant period of time against his or her will in a ship, vehicle, or airplane.
- Ransom and extortion payments
- In-transit money delivery coverage
- Negotiation costs
- Consultant costs
- Interest fees coverage
- Public relations costs
- Judgment settlements and defense costs
- Harm to the captive employee and his/her family (Including death and dismemberment benefits, medical costs, and psychiatric treatment once the employee has been freed).
* It is advised that employers not reveal their K&R coverage to employees. This is intended to protect employees from revealing that they are insured to their captors as a sizable K&R insurance policy could easily make the employee a desirable target.
Businesses with operations overseas need K&R insurance to protect their employees while traveling for work. It’s important to note that company size is irrelevant to potential kidnappers. In the kidnapping business, anyone with money is a target.
There are certain parts of the world that are considered particularly high risk. These countries include Brazil, Mexico, Venezuela, Honduras, Afghanistan, Pakistan, India, Somalia, Nigeria, South Africa, and Philippines.
Premiums for this coverage is typically determined by:
- Type of industry
- A company’s revenue
- Country of residence
- Employee travel patterns
Do your employees travel internationally? ERM Insurance Brokers in Irvine, California can answer any questions you may have regarding K&R insurance for your business!
Call (949) 222-0444 to speak with an expert.