With more people today traveling abroad for business, pleasure or an excursion to an additional residence, the threat of a kidnap and ransom or extortion incident continues to increase.

But a family that has examined the issue in advance may have greater ability to control the incident and improve the outcome and likelihood for the safe return of a family member—should the unthinkable happen.

Some events typically covered by a kidnap and ransom (K&R) policy include: kidnapping for ransom; wrongful detention/holding under duress without a ransom demand; extortion to divulge confidential or private information; and hijacking of an aircraft, motor vehicle or waterborne vessel.

One of the primary benefits of K&R coverage is access to an experienced crisis-management team. Insurers are able to immediately engage consultants in crisis/security response firms who specialize in managing and negotiating during these incidents.

In addition to reimbursement for a ransom payment, a K&R policy will cover related expenses, such as security response-firm consultant fees and reimbursement for additional expenses, which may include rewards to informants, travel and accommodation costs, legal advice and medical or psychiatric care.

Stephen Poux, senior vice president and head of Risk Management Services and Loss Prevention at AIG Private Client Group, sees the importance of offering clients a holistic approach.

“Proactively addressing situations that might put an individual or family at risk is just as important as the coverage itself,” Poux says. “By working with policyholders to evaluate their unique lifestyles, we can provide them with tools to help reduce the likelihood of something happening in the first place.”

Even business travelers have to be wary of kidnapping in today’s world and take extra precautions when abroad.


When the lives of loved ones are at stake, security experts agree it is important for families to be prepared to pay ransom demands. However, advisors also add that negotiating ransom demands, as opposed to meeting the kidnappers’ initial demand, has proven to be the safest way to ensure the safe return of loved ones. Generally, security firms find that reaching an accommodation through negotiation is achievable in most cases, even with unsophisticated kidnappers.

While it is in a family’s best interest to negotiate ransom demands, it should be mentioned that many authorities and governments strongly oppose the payment of any ransom and refuse to negotiate ransom demands. In the event of a kidnapping, ransom, or extortion incident, a family will face making many such complex decisions.


Most insurers have relationships with security firms that have expertise in dealing with kidnap, ransom and extortion; have offices in many countries; and offer a range of risk-analysis programs and other security services.

Oftentimes, security firms will conduct a comprehensive analysis to determine the family’s level of risk and provide their expertise on preventative measures. Security firms will also assess a family’s level of risk for becoming a target and help family members determine what their response should be to a kidnapping, ransom or extortion incident.


If any of the following red flags apply to you, your first step should be a conversation with a qualified insurance advisor. By taking this step, you’ll be on your way to a more secure future. Do you:

  • Have a high-visibility profile and lifestyle?
  • Have an actual or perceived position of power?
  • Travel abroad for business or pleasure?
  • Travel via private vessel on the sea or by air?
  • Have family members who are residing overseas for an extended period of time, including children studying abroad?
  • Have concerns about the increasing danger of abduction or extortion?

A trusted personal insurance risk advisor who regularly works with high net worth clients can help you examine potential risks.