A kidnapping incident can have a devastating effect on the family
and employer of a victim. Apart from the mental trauma, the financial impact of
paying a huge ransom cannot be ignored. This is where insurance cover for Kidnapping
and Ransom or K and R cover can help individuals and employers.
The demand for K and R insurance has seen an increase in India following
globalization and MNCs setting up operations in India. Those in need of such cover include organizations that
have high profile management and those that handle large amounts of cash or work
with sensitive information or technologies. Top executives of these companies prefer
to have K and R cover to protect themselves and their families. Employers too
opt for this insurance cover to protect against huge losses on ransom payments, business
interruption, litigation, adverse publicity and damage to reputation.
The cover provides financial and other resources to aid corporations and the families of
employees in resolving a ransom demand in a kidnap. Most policies also provide
financial resources for resolving extortion threats against corporate assets or products.
Another important point is the purchase of K & R insurance must be confidential. The existence of the coverage could create a target where none existed earlier.
Another important point is the purchase of K & R insurance must be confidential. The existence of the coverage could create a target where none existed earlier.
Scope of Coverage:
The cover includes
Ø
Ransom / Extortion monies, including delivery expenses
Ø
Transportation loss of ransom money
Ø
Related expenses, viz., salary, personal financial loss, medical
costs, rest and rehabilitation, travel and accommodation, loan interest,
reward, interpreter, forensic analysis, other reasonable and necessary
expenses, recall expenses, business interruption etc.
Ø
Judgment, Settlements and defense costs
Ø
Death or Dismemberment arising from a covered incident
Ø
Crisis management expenses , including negotiation services fees
Possible Extensions:
Ø
Evacuation and repatriation of the person
Ø
Legal costs to defend claims of negligence in incident handling
Ø
Child abduction
Ø
Post-incident rest & rehabilitation expenses
Ø
Product contamination risks as part of extortion
Ø
Political threat coverage’s
Exclusions:
Ø Fraudulent,
dishonest, or criminal acts of the Insured or a covered person(s), or any
person authorized by the Insured to have custody of ransom monies
Ø Monies paid by a
covered person(s) in a situation where local authorities have declared such
payment illegal
Ø Monies or property
surrendered away from the premises in any face to face encounter involving the
use or threat of force or violence unless surrendered by a person in possession
of such monies at the time of such surrender for the sole purpose of conveying it to pay an
extortion or demand for ransom monies previously communicated to the Insured or
a covered person(s); or
Ø Monies or property
surrendered on the premises unless brought onto the premises after the demand
for ransom monies for the purpose of paying such demand; or
Premium Rating:
Rating of the policy shall depend upon
perceived risks by the underwriter after considering variables which include
geographical location, number
of employees in a particular
location, employee’s travels schedule, past kidnapping and ransom incidents,
nature of duties etc.
Policy features:
Ø The policy is generally issued on
reimbursement basis
Ø The policy includes limits per loss within
an aggregate policy limit
Ø Considering the peculiarities of the
policy, it is normally a condition that the existence of the policy is kept
confidential
In India K and R insurance is being
offered by private sector insurance companies. . To know more about getting the right insurance policy based on your
needs and an unbiased opinion on the best options please visit
www.zeninsure.com or call us on +91 9848884363