Experts Needed On K&R Exposures
"Kidnappings for the most part are not random occurrences," noted William Harrison, managing director, crisis management practice for Aon in Princeton, N.J.
Before a kidnapping takes place, he said, the targeted person "is under surveillance for a period of time."
This is where the assistance of an experienced security firm can help prevent a kidnapping from occurring. Among other things, a security firm can advise on which lifestyle patterns or driving habits can be changed to make an employee less of a target, stated Keith Thomas, vice president, corporate markets for Zurich North America, New York.
Security consultants "have their ear to the ground" in a number of the worlds riskiest places, often taking advantage of access to intelligence networks, he noted.
In fact, many security consultants are able to draw on their personal experiences with the Federal Bureau of Investigation, the Central Intelligence Agency or the military, Mr. Thomas said.
As a result, security consultants can offer invaluable advice to a company with employees who travel overseas or are stationed abroad.
Mr. Harrison said that security firms recommended by insurers or otherwise retained by insureds normally do not negotiate on behalf of a company when a demand for ransom or extortion money is made.
Instead, a security firm will work with an employee of the insured company, training and guiding the person on how to communicate properly and effectively with the kidnappers or extortionist, Mr. Harrison explained.
The firm also can tell the company and the designated negotiator "the going rate" demanded as ransom or extortion, who the "kidnapping gang" is based on past performance, what the kidnappers are likely to do and how far they would go with their threats.
Equally as important, a good security firm can help a company achieve the "key balance" between paying too much and offering so little that the kidnapper or extortionist feels insulted. Mr. Harrison said the goal is to arrive "at the right amount so that the kidnappers think they have every dime you've ever had and they don't hold the [victim] and ask for more."
Mr. Harrison said that the security consultant used by an insurer is one of the principal things Aon advises its clients or prospects contemplating K&R coverage to consider carefully.
The types of questions to ask, Mr. Harrison said, include "who are the best consultants out there, what are their strengths and weaknesses" and in what areas of the world do they have particular expertise.
Then a company must determine whether a particular security consultant has "real experience" and can offer services in the areas of the world in which the company has operations or traveling employees.
In short, a company must be sure that it is buying not only a quality insurance product, but also the services of a quality security consultant, Mr. Harrison stressed. "Otherwise the insurance wont do much good," he said.
Reproduced from National Underwriter Property & Casualty/Risk & Benefits Management Edition, June 17, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.
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