This article was initially queued for December however, the recent headlines have moved it forward. I am glad my past organizations had K&R insurance in place. I am even more thankful that some of previous business owners I worked with had the foresight to put these policies in place for all company personnel worldwide and not just as an executive perk.
K&R insurance provides a combination of financial indemnification and expert crisis management. The premiums are based on a variety of variables: geography, travels, past ransom incidents. Most coverage can be purchased for <$600/year. Most kidnappings are not reported publicly so data is rare. 90% of cases are not reported. Kidnapping is a well organized crime enterprise. Lloyd’s of London compiled statistics organized enterprise. The latest data I could find was 1992-2002:
Since that time there has been a rise in kidnappings in Iraq, Afghanistan and Africa as armed conflict has risen there.
Corporations have become a bigger target of kidnappers than celebrities and political figures. Companies are perceived as having deeper pockets than individuals. Paying a ransom is solving the problem after it has occurred. There is still the support for the victim’s family, management disruption and stress that occurs after the kidnapping fact. A fuller risk management approach would be preventive and include:
The existence of K&R insurance is an employee benefit, however, knowledge of the existence of such policies should be on a need to know basis only. It should not be discussed externally as it increases the probability of a kidnapping incident and may be cause for coverage termination. My research indicates that AIG, Chubb and Travelers Group are prominent insurers offering this type of coverage. Consider K&R insurance as a cost of doing business abroad. You may want to refer to the post below:
I do not pretend to be an insurance expert, I do pretend to be an expert on international business development topics so please contact me in that vein. Have a great Thanksgiving!
During a recent peer group collaboration at a local University one of my colleagues related that his global clients were finding it harder to compete in global markets in 2015. The financial press is rife with US domestic companies reporting lower 2015 sales due the strong $US. These negative trends are caused by two phenomena:
You need to support your channel to win. Consider:
If you need assistance designing a specialized program or exchange rate agreement let’s figure out together how we can reach your objectives.