What if Your CEO is Kidnapped While Travelling Internationally?
When you think about what could go wrong during an international business trip, you probably imagine deals falling through, missed connections or cultural blunders. The risk of being kidnapped is not top of mind for most executives, yet, kidnapping is a serious risk, especially in some parts of the world. A company’s CEO may make an attractive target for criminals looking for a big ransom payout.
Business Executives May Be at Risk
Many kidnappings are financially motivated. Kidnappers seeking large ransoms may target wealthy individuals, such as executives traveling abroad on business.
Business Insider published a list of 11 kidnappings involving millionaires and executives. This included the CEO of Heineken International, who was held hostage for 21 days in 1983, and a Dutch grocery executive, who was held captive for months in 1987.
Although these high-profile examples happened decades ago, kidnapping remains a problem. As a more recent example, Voice of America says three gunmen killed police escorts and abducted an oil executive in Nigeria, where kidnapping for ransom schemes often target wealthy oil workers and businesspeople.
Kidnappings Are on the Rise
Some regions have seen recent surges in kidnapping rates.
- South Africa has seen an increase in kidnapping cases, according to Yahoo. Between July 2022 and September 2022, there were more than 4,000 kidnappings – double the rate from the same period in 2021.
- Kidnappings have increased in Haiti, according to Reuters. The rights group CARDH says there were 389 kidnappings in the first three months of 2023, which is three times greater than the number in the fourth quarter of 2022.
- The U.S. has issued travel advisories for several states in Mexico due to the risk of crime and kidnapping. The U.S. advises Americans not to travel to Colima, Guerrero, Michoacan, Sinaloa, Tamaulipas, and Zacatecas due to crime and/or kidnapping. The U.S. also urges Americans to reconsider traveling to Baja California, Chihuahua, Durango, Guanajuato, Jalisco, Morelos, and Sonora.
What Happens During a Kidnapping?
The FBI says international kidnapping and hostage cases usually involve criminals or terrorist organizations seeking ransoms for captive Americans. People can reach out to law enforcement or the U.S. Embassy for help. The FBI’s in-country liaisons will work with the ambassador and U.S. Embassy team to seek support from local law enforcement. The main goal is recovery of the victim, followed by prosecution of the kidnapper. The U.S. has a policy of not paying ransom demands – the FBI admits that dealing with ransom demands is challenging.
Even though the U.S. government won’t pay ransoms or support the payment of ransoms, some private individuals and organizations do decide to pay. Critics of this approach argue that it supports criminal activity and encourages additional kidnappings, but people often feel there is no other way to secure the safe recovery of the victim.
Kidnap and Ransom Insurance
Dealing with a kidnapping situation is stressful. Missteps can result in the victim being injured or even killed. To protect against the risk of executive kidnapping and secure support in the case a kidnapping occurs, some businesses purchase kidnap and ransom insurance.
According to Investopedia, kidnap and ransom insurance typically covers the ransom payment, loss of income, interest on bank loans, and medical care. The insurance carrier does not pay the ransom upfront: the victims must pay the ransom and the carrier will reimburse the cost. Perhaps even more importantly, ransom and kidnap insurance typically provides access to specialists who will negotiate the release of victim, delivery of the ransom, evacuation, and care. Both individuals and businesses can purchase kidnap and ransom insurance. When a business purchases coverage for an executive, it may also apply to spouses, nannies, and other people connected with the insured, depending on the terms of the policy.
Should Your Business Purchase Kidnap and Ransom Insurance?
Business leaders should not discount the risk of kidnapping. If one of your executives is taken hostage for ransom, you will face financial loss as well as serious trauma and potential loss of life. Kidnap and ransom insurance can provide the financial and specialist resources you need to gain the best possible outcome.
If your executives travel internationally, kidnap and ransom insurance may be a wise investment, especially if they travel to regions where kidnapping is common. Even if your executives stick to relatively safe areas and use security protection, a kidnapping is still possible. People around the executive may also be targeted.
Tangram offers kidnap, ransom, and extortion insurance coverage. Our program provides pre-trip risk assessments and other features designed to help keep you safe. Learn more.