Do you fully understand your corporate Kidnap and Ransom policy and appreciate what would be involved if you ever had to make a claim? Many organisations do not, according to a recent Airmic Academy. The session also heard how risk managers can help companies reduce the risk of staff being taken hostage in the first place and, at the same time, fulfil their duty of care. Mark Baylis reports.
This informative and highly interactive session brought home the extent of hostage taking and the devastating impact it can have on victims, their families and colleagues and an organisation. Although entertaining at times, especially when Airmic members volunteered to fulfil unfamiliar roles such as communicators with kidnappers or media spokespeople, I left with two strong impressions.
The first related to the scale of the problem. No one knows how many K&R incidents take place every year as many go unreported, but 40,000 is a commonly cited figure, according to AIG. Most take place in countries you might expect such as Mexico, Nigeria, Iraq, Afghanistan, Somalia and Pakistan, but Europe accounts for around 3% per cent; that is well over a thousand incidents annually. Eastern Europe is an area of particular concern
The second impression goes beyond statistics to the sheer terror and misery that it causes. Tess Baker of NYA International consultants played a recording of the wife of a Mexican victim speaking to her husband’s kidnapper. You did not need to understand Spanish to find it a harrowing experience. As Bill Laurence, operations director at NYA, put it: “you can smell the fear”.
The session looked at precautions organisations can take pre-incident, what to expect when something does happen and the insurance options. These three aspects of kidnapping are, in fact, all part of the same picture; a key benefit of taking out a K&R policy can be free access to risk prevention and crisis consultancy in the event of a kidnap.
Julien Monegier du Sorbier, head of the UK K&R team at AIG, said that the secrecy and sensitivity of the subject was one reason why important questions about policies went unasked. Whatever the reasons, companies frequently do not know what is covered or the likely sequence of events when there has been an attack.
It is estimated that total global ransom payments are in the region of $500 million per year, he said. Many of the incidents are relatively low-key. For example, so-called express kidnapping has become a “national sport” in some countries. Typically, someone posing as an airport taxi driver will take his passenger to where a criminal gang are waiting. Carjacking is another hazard in some places. Although extremely unpleasant, these incidents normally end quickly and without serious injury.
Full-scale kidnapping, where an individual is taken hostage and money demanded for their safe return, is altogether another matter. Insurance from AIG, he said, can protect all employees and their relatives, whether or not they are working when the attack takes place. It also covers travelling companions and visitors. The maximum limit is $50m per insured event but, he said, the $1m - $10m range is more appropriate for most clients.
One of the biggest benefits of purchasing K&R policies, he stressed, is access to consultants at a moment’s notice; in the case of AIG, that means NYA. When kidnap happens it normally comes totally out of the blue for all concerned, including the victims’ families and colleagues. Emotions run high and the pressure can be enormous. That is when advice from experienced, independent professionals can make all the difference.
Tess Baker and Bill Laurence of NYA set out the role of the consultant. Although every kidnap is different, they tend to have common traits. Consultants offer advice based on many years’ of experience; they do not speak directly with the kidnappers or try to take over the case. Decision making ultimately rests with the client and their confidentiality is of utmost importance. One question they are always asked, but can never answer, is how long a particular episode is likely to last.
NYA chose Mexico for their reconstruction, dividing the group into teams and asking them to respond to a kidnap scenario. “Mexican gangs can be violent, they’re not interested in your problems and they carry out their threats,” explained Laurence. “They’re quite willing to remove an ear or a digit.”
Because of the sensitivity of the subject, it would be inappropriate to publicise the advice in detail, but some key points to emerge were:
· The first 24 hours after a kidnap are absolutely crucial, so it is essential to have thought about it in advance and to have access to 24/7 support;
· When the kidnap takes place, you need to develop a strategy;
· It is vital to support and keep the victim’s relatives on-side, a task that can sometimes be just as challenging as dealing with the kidnappers;
· You will need a plan in case of media interest;
· If you pay a ransom, then make sure you know how to obtain and deliver the cash.
It is helpful, said Baker, to meet your consultants in advance so that you know what to expect. She also emphasised the value of pre-incident risk management measures such as employee kidnap awareness courses. Apart from making employees better prepared, such steps are part of an employer’s duty of care and may help mitigate legal liability if a member of staff is taken hostage.
The meeting was followed by an informal lunch, but Bill Laurence was unable to stay; he had just been notified of another new incident and was off to the airport.
Airmic Academy presenters, Wednesday 10 April
Julien Monegier du Sorbier, K&R manager
Samantha Cowper, Senior Underwriter, Kidnap & Ransom
Bill Laurance, Operations Director
Tess Baker, Marketing Director