Kidnap and Ransom Insurance for CEOs and Senior Executives

Posted on February 21, 2012 by knrwpaccess

Kidnap and ransom insurance for CEOs is a separate consideration in most large companies. Large companies and non-profit organizations that have employees traveling or working internationally as expatriates, typically have an existing kidnap and ransom insurance policy in place today.

When McKinley International is asked to provide consultation on kidnap and ransom insurance for these companies, it is not because they do not have an existing policy; it is usually because the existing kidnap for ransom insurance policy is inadequate for the situation and CEO travel. One size does not fit all.

Even when we find an adequate kidnap and ransom insurance policy for the employee group as a whole, we sometimes take a different approach for kidnap and ransom insurance for CEOs and senior executives. For example, the kidnap and ransom insurance for CEOs may require a policy with much higher limits that say, the $500,000 limit on the general employee population.

International security consultants are often asked to write a named policy for kidnap and ransom insurance for CEOs and senior executives, even when and an existing international kidnap and ransom insurance policy exists. Other reasons beyond the need to provide an additional kidnap and ransom insurance benefit include a better consulting company for the region, additional benefits attached to the policy, and no need to front the ransom money.

Economic Distress across the Globe Increases the Need for Kidnap and Ransom Insurance

Posted on February 18, 2012 by knrwpaccess

The global economic storm makes the threat of kidnap for ransom much more likely over the next 20 years. Kidnap and ransom insurance is becoming a staple for any American living abroad for reasons we discuss below.

We have all heard the horror stories about Daniel Pearl in Pakistan, Nick Berg in Iraq, and other victims kidnapped abroad and violently murdered – because either the demands could not be met, or the demands were unreasonable in the first place. This was the case with the two victims above, both Americans beheaded on video tape! Fortunately, these types of kidnappings are still very rare in the world.

Kidnapping Continues to Grow Worldwide

The “business” of kidnapping is growing at a shocking pace; the trade of live bodies for ransom money is only expected to get worse over the next twenty years. The party in the “rich nations” is over for quite some time.

Record deficit spending and over-inflated “bubbles” in housing, stocks, and commodities will mean that rich nations can no longer keep up the spending and will need to de-lever over the next 10 to 15 years.

At the very best, this means economic doldrums for the U.S., all of Europe, Japan, and even China for at least 10 years. If sovereign deficits are not addressed immediately, we would see global collapse and “depression like” levels of negative economic growth.

With the rich countries putting their wallets away for up to a decade as the storm blows over, this will have a trickle down effect on the developing world and the poor will get even poorer and more desperate in Latin America, Africa, and the Middle East. Somali pirates will grow in number. The badlands of Rio will expand in every direction. The population of shantytowns in Mexico City will have increase by 250,000 people a year.

Many will Choose Kidnap and Ransom Insurance

Desperate people means that kidnap and ransom insurance for all American expatriates and travelers will become an essential benefit for the near future. A larger population of poor and increased desperation will feed the business and infrastructure of the global kidnap for ransom business. Unlike most in the global economy, the “kidnap business” will be a growth industry for the next 10 years. (Wall Street must be envious they cannot participate in one of the few growth sectors of the next decade!)

We predict the growth in “Hollywood style” kidnappings, where the kidnappers make incredible demands of $1,000,000 or more will certainly not be the norm. Instead, we expect that the poor in the developing world will see the presence of Westerners as a meal ticket, a way to escape destitution, or to find enough money to treat a sick child at home sleeping in a box. Kidnap and ransom insurance plans will pay out smaller amounts much more frequently.

The burdens on kidnap and ransom insurance will not be on the insurance benefit. Thousands of these international kidnapping will only ask for $20,000 to $50,000 as the initial ransom, and most will be negotiated down by 50%! It will be the consulting aspect of a good kidnap and ransom insurance program that will save lives.

If an expatriate kidnapping occurs and the kidnappers only request $15,000 USD from the family, does that mean the family can “relax” because they have $100,000 in the bank and can easily write a check to get safe return of the head of household? If people would stop to think through this scenario, they would not like what they find.

K&R Insurance Ensures Professional Assistance

Driving out to see armed killers and kidnappers at 2 a.m. with $20,000 of cash in the car and of course, no police or the kidnappers have threatened to kill the hostage. What would stop them from taking you as a second kidnap victim and starting the process all over again?

No, the right consulting company that can successfully and professionally negotiate with international kidnappers and then secure safe release of the hostage is the most important part of a good kidnap and ransom insurance policy. The actual benefit of a kidnap for ransom insurance policy is only 4th or fifth in importance for 95% of international kidnappings that will occur in the next decade.

Kidnap for Ransom Insurance for Contractors in Iraq

Posted on February 16, 2012 by knrwpaccess

Officially, as of December 17 2011, the United States has no more military personnel on the ground in Iraq (other than trainers and certain support personnel) and, officially, the war was over. However, the U.S. contractors that have been working in Iraq on infrastructure projects and for a variety of other reasons (like military trainers) have not pulled out of Iraq on the same timeframe. They are still there! We anticipate the kidnap risk in Iraq is now much higher because of the speedy withdrawal of the U.S. troops in Iraq. Therefore, kidnap for ransom insurance for contractors in Iraq has now become as essential as war risk medical insurance in Iraq.

If sectarian violence in Iraq emerges, again kidnap risk in Iraq will go up ten-fold. Contractors in Iraq wishing to purchase kidnap for ransom insurance should purchase the policy now, before any violence breaks out. Kidnap for ransom insurance rates for contractors in Iraq do not stay the same and can change daily. If violence waves emerge again, the rates could be 100% higher on Friday for kidnap and ransom insurance then they were on Monday.

We are watching Iraq very closely over the next six months. No contractor in Iraq should be without a kidnap for ransom insurance policy at this critical time.

Kidnap and Ransom Insurance for Celebrities Traveling Internationally

Posted on February 13, 2012 by knrwpaccess

There are hundreds of non-profit organizations based in the United States; many operate aid and relief organizations around the world. Many of them recruit celebrities to endorse their causes. On many cases, celebrities traveling abroad will be sponsored by the NGO or PVO group to bring attention to the cause in certain developing countries. The problem is, these developing countries pose the highest kidnap threat for celebrities. For this reason, kidnap and ransom insurance for celebrities is an essential product that cannot be offered by the sponsoring NGO.

Kidnap and ransom insurance for celebrities is a product offered by Lloyd’s of London. Celebrities traveling international to promote the good cause of their NGO group are serious kidnap targets in Latin America, Africa, and many other areas. McKinley International Risk Management was contacted just this week about insurance for celebrities traveling abroad, in this case to Ecuador. Kidnap risk in Ecuador for high profile celebrities and high net worth individuals is very high.

If a celebrity leaves the country for just 10 or more days a year, although kidnap and ransom insurance polices are annual, they should consider purchasing a kidnap for ransom insurance policy. Celebrities cannot participate in existing kidnap and ransom insurance policies of their NGO because they are not employees of the NGO. It’s possible the kidnap and ransom insurance policy of the non-profit organization can arrange to cover employees and volunteers (non-employee celebrities), but this won’t be possible in every case.

Even though celebrities traveling abroad may be traveling with person security details, it is not enough. Kidnap and ransom insurance policies for celebrities are essential for world travel, even to Western Europe.

Kidnap for Ransom Insurance for Journalists

Posted on February 10, 2012 by knrwpaccess

In 2012, the work of journalists seems to be more hazardous than ever before. In addition to blatant war risk when journalists are reporting in active war zones, there is a kidnap for ransom risk for journalists both in and out of war zones today.

All the major news organizations have reporters and journalists in dangerous countries in the news today, and almost all of them present a significant kidnap for ransom risk for journalists. The proper kidnap for ransom insurance for journalists and reporters is an essential benefit.

There is no question that good employers like CBS News provide a kidnap for ransom insurance benefit for journalists and for their reporters. However, the problem is that technically, the employer is not allowed to share the details of the kidnap for ransom insurance plan for journalists with the reporters themselves.

For any journalist working for a smaller organization or freelancing we strongly suggest they purchase an individual kidnap for ransom insurance policy for journalists, whether that kidnap and ransom insurance policy is reimbursed by their employer or not. In the event of an incident in Egypt, Syria, Libya, West Bank or the 20 other dangerous locations where reporters report, nothing could be more important.

International Kidnap Insurance for Global Travelers on Medicare

Posted on February 8, 2012 by knrwpaccess

For 50 years, when those into their retirement traveled the world they only had one thing to worry about, purchasing global travel medical insurance because Medicare does not pay claims outside the United States.

For many, international kidnap insurance is just as important. Actually, when you survey seniors about the territorial limitations of Medicare about 50% do not know it does not provide medical coverage outside the United States, which is very dangerous. Medicare also does not provide medical evacuation and repatriation outside the U.S.

In today’s dangerous world, if you are over age 65 and plan on traveling the globe and seeing sights like the Pyramids of Giza or Machu Picchu in Peru, you should consider an annual international kidnap insurance policy.

“Some of the great wonders of the world are in the most dangerous places on earth for kidnap for ransom insurance risk,” says Matthew McKinley founder of McKinley International Risk Management. “If you want to see the Tower Bridge in London or the Eiffel Tower in Paris that is one thing, but sites like Victoria Falls in Africa or the Pyramids of Giza are another.

Kidnap and ransom insurance is almost a necessity for today’s senior citizen spending a few years of retirement traveling the world. Annual international kidnap insurance policies can be purchased by seniors to cover themselves or their families.

McKinley International & KidnapAndRansom.net

Posted on December 5, 2011 by knrwpaccess

Our parent website is found at http://www.mckinleyinternational.com/. Owner Matthew McKinley has almost 20 years of experience working to secure insurance programs for people that work and travel internationally, from the largest Fortune 500 company to individual contractors working in Afghanistan. If you are just an individual, you are NOT too small to contact us as we work with individual expatriate families every day.

“From my very first trip to Mexico City in 1994, I knew safety and security would be the prime concern for expatriates and international business travelers in most countries worldwide. Riding along Rio Consulado back to the airport in a large white Chevy Suburban surrounded by cars ten years older and hundreds of green VW “bug taxis,” I knew I stood out like a sore thumb from a security perspective. Getting to my business destination was even worse, as I was picked up by a poorly dressed young man holding a sign in the airport “M. McKinley.” (It should have said Dumb American.) I was taken to my hotel riding in the front seat of a 1983 Ford Torino! I was a sitting duck and was lucky when we pulled up to the Hotel Presidente, one of only a small handful of hotels in Mexico City safe for foreign travelers. If you have been to Mexico City, you can understand there was NO WAY I could understand where he was driving me. It was like driving through a maze. The sun was my only frame of reference!”

From a psychological standpoint, people have the tendency to look the other way and say “it won’t happen to me,” and unless these products are easy to secure, many people may do nothing or just hope for the best. This is not prudent in today’s dangerous world. It’s too late to wish you had done something after you get a phone call and a family member is missing. Even if you don’t buy a kidnap insurance policy, have you done all the other things you need to do to keep you and your family safe?

Kidnap Insurance for High Net Worth Individuals and Families

Posted on December 2, 2011 by knrwpaccess

Most people that purchase individual kidnap insurance policies, or policies that only cover themselves or their families are typically expatriates living abroad, or frequent international business travelers entering “hotspot” countries with a high risk of kidnap and abduction.

However, there are more than 1,000,000 people living in North America that are considered VHNW (Very High Net Worth) individuals and about 90% of them have no kidnap and ransom insurance on themselves and their families. We feel this is a mistake.

It’s a fallacy to assume kidnap insurance is only needed when one is outside the U.S. and Canada. Although it’s rarely on the news, very high net worth individuals are increasingly the target of kidnap and extortion threats living inside the U.S. and Canada. An annual kidnap and ransom insurance policy for VHNW individuals will work in the home country and also provide coverage as the individual and family travels or vacations outside of North America.

A typical family of 5 VHNW is a target in the U.S. and you would be surprised how many international trips these people take abroad. The breadwinner may be in Mexico City on business, the spouse in Germany on vacation, and the kids on “semester abroad” with their university. The exposures never stop.

A one year kidnap insurance policy is good for an entire year, and costs start at just $1,500 a year.

Short Term Kidnap Insurance Policy

Posted on November 29, 2011 by knrwpaccess

At this time a short term kidnap insurance policy for international business travelers and those taking an international vacation does not exist. We say this because we receive hundreds of requests from people looking for short term kidnap insurance because they are going overseas for a few days or a few weeks a year.

Our most recent request was for 4 days of scuba diving in Borneo. There are tens of thousands of people that are traveling into locations that are “less than safe.” We are working on a short term kidnap and ransom insurance policy but until it is developed, a one year individual or family policy is available for around $1,500 US a year and many should consider purchasing it.

If you are a frequent international business traveler or even a retiree taking extended vacations abroad you should consider a full annual kidnap insurance policy. For example, a retired couple spending 3 weeks in Southeast Africa on Safari and then will have two other vacations during the year, to Mexico and then to China, will be spending $18,000 or more on all three vacations.

Would spending another $1,500 for the protection of kidnap insurance be worth it? For high net worth individuals traveling in these hotspot locations, we would say the answer is most definitely yes.

Kidnap and Ransom Insurance for CEOs

Posted on November 27, 2011 by knrwpaccess

Many global employers that employ expatriates and global travelers have some sort of kidnap ransom and extortion insurance program in place. This can be a stand alone kidnap and ransom insurance policy (preferred) or a program “attached” to another global insurance programs like international commercial liability or foreign workers comp. for example.

No matter what program exists for the general employee population, a dedicated kidnap and ransom insurance program for CEOs should be considered as well as a plan that can also cover a team of top management and executives including the CFO, Chairman of the Board, etc.

The reason for covering them again, blanket policies and kidnap insurance attached to other forms of insurance are mostly inadequate. You want to protect the top people, the executives that are the prime targets, with a program with full service capabilities, like a dedicated K&R insurance package for CEOs and other executives. These are named policies that list, by name, the individuals covered under the policy.

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