War in Iraq, terrorism heightens exposure; insurers offer coverage, expertise

The war in Iraq has brought incidents of hostage-taking and kidnappings to the forefront. It seems that every few weeks the TV news media broadcast new video of people being held hostage and pleading for their lives.

While the scenes are chilling and awful to watch, these types of incidents have been an ongoing problem in others parts of the world for many years–but not highly publicized. Colombia, Mexico, Brazil and Argentina are hotbeds of kidnapping activity. Indeed, Colombia has the highest kidnapping rate in the world with 1,441 reported abductions last year. Unfortunately, many more incidents go unreported.

Although it's difficult to track actual statistics, there's no question that kidnapping, extortion and illegal detention incidents are on the rise. Some estimates suggest that more than 15,000 incidents occur internationally each year. Those statistics are staggering and a cause for consternation–particularly among companies with foreign operations.

Employees who work for companies that conduct business abroad have every right to feel anxious about traveling within the United States and to foreign locations these days–and many do. Many more are starting to seek counsel or guidance from their employer about how to alleviate the anxiety and feel as safe as possible when traveling on business.

Particularly since 9/11, more business travelers are thinking about incidents that could occur in airports, peculiarities about certain destinations, and how to avoid becoming a victim of crime. They want answers to questions such as:

o How can I be safe while traveling?

o What will my company do if I become the victim of a kidnapping, hijacking, extortion or detention incident?

o Who will take care of my family?

These are all fair questions and ones that companies and their risk managers must address.

Businesses have an obligation to protect their employees both at home and abroad. First and foremost, risk managers should work to reduce the level of employee anxiety about business travel.

One way to help employees is by providing travel security briefings. Most security companies offer on-site briefings by security specialists. Often, these briefings are tailored to specific cities so employees know what to expect before they leave home, while they're in transit and once they arrive at their destination.

The briefings can also take the form of a video that can be viewed by employees at the office or at home. Many online organizations offer this type of service. It's important to give employees the tools they need to feel more confident when traveling on business.

Second, risk managers should try to reduce the exposure their company faces from a potential kidnapping threat. Developing the right preventative measures involves learning how kidnappers and extortionists operate.

Kidnappers typically select their targets according to individual or corporate wealth and vulnerability, so businesses should take precautions to disguise and guard against both. Although management and employees have a tendency to think that “it won't happen to me,” that attitude may, in fact, put them at risk.

Risk managers can protect themselves and help their company's employees by investing in kidnap and ransom insurance coverage. The K&R policy covers the costs associated with the recovery of abducted employees anywhere in the world. Covered costs include ransom payments, personal financial loss, security services, and employee and family counseling.

A key component of the security service is the expert advisors who are on call 24-hours a day, seven days a week, to negotiate with kidnappers, work with law enforcement and provide other services to resolve an incident in a safe manner. Besides kidnapping, the insurance covers extortion, illegal detention and hijacking incidents.

The horrific events of 9/11 have prompted the U.S. government to take a number of steps to try to protect the American people from terrorist threats. However, while the government is doing its part to try to protect the country and its citizens, it can't do it alone.

It is up to businesses and individuals to take responsibility and be proactive about protecting themselves and their employees from potential threats such as kidnapping, extortion and illegal detention.

Risk managers can pull together a team of people responsible for developing a plan to help reduce employee anxiety about national and international travel, then distribute the plan to employees and begin implementation. The plan should include the extra protection insurance coverage can provide.

Unfortunately, kidnapping is a crime that goes unchecked in many parts of the world due to ill-equipped and poorly trained law enforcement agencies and a legal system that accepts favors or fears violent retribution.

While that environment has allowed kidnappers to develop their skills over the years, the expert advisors have also honed their negotiating techniques. That means very few hostages are killed or injured during an incident.

The good news is that risk managers who add K&R coverage to their insurance portfolio that includes an expert advisor to handle negotiations, experience a greatly increased chance that their victim will emerge safe and unharmed from an incident.

David Lattin is director of industry practices for financial and professional services at St. Paul Travelers.

Caption for main art:

Risk managers can play a key role in training employees on how to avoid being kidnapped, as well as hiring experts to help recover a worker safely if they are taken for economic or political reasons.

“Although management and employees have a tendency to think that 'it won't happen to me,' that attitude may, in fact, put them at risk.”

David Lattin

Flag: RM Tips

What Can You Do?

Risk managers can not only help to prevent kidnapping of employees but set the stage for a safe recovery as well if the worst should occur. Here are a few steps to consider:

o Provide travel security briefings, in person and/or via video.

o Be specific about potential threats. Tailor briefings so workers know what to expect before they leave home, while they're in transit and once they arrive at their destination.

o Work to reduce the possibility of a potential kidnapping by disguising corporate wealth and guarding against vulnerabilities.

o Consider kidnap and ransom insurance that covers ransom payments, personal financial loss, security services, and employee and family counseling.

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