Kidnap and ransom insurance or K&R insurance is designed to protect individuals and corporations operating in high-risk areas around the world.
Losses typically reimbursed by K&R insurance include:
Ransom monies – Money paid or lost due to kidnapping
Transit/delivery – Loss due to destruction, disappearance, confiscation, or wrongful appropriation of ransom monies being delivered to a covered kidnapping or extortion
Accidental death or dismemberment – Death or permanent physical disablement occurring during a kidnapping
Judgements and legal liability – Cost resulting from any claim or suit brought by any insured person against the insured
Additional expenses – Medical care, severe disruption of operations, potential damage to company brand, PR counsel, wage and salary replacement, relocation and job retraining, and other expenses related to a kidnapping incident.
The policies also typically pay for the fees and expenses of crisis management consultants. These consultants provide advice to the insured on how to best respond to the incident. Even the most basic training for people traveling to dangerous places is not easily provided or is not obtained by small to mid-sized companies.
AM Best recently shifted its outlook on the global reinsurance market to positive for the first time in history, reflecting improved market conditions and potential profitability. The last significant change was in 2018 when the outlook was upgraded to stable, with no record of a previous positive outlook. This notable change, coinciding with AM Best's 125th anniversary, highlights the enhanced return potential driven by higher pricing and stricter coverage terms in the reinsurance sector, benefiting both traditional reinsurance and insurance-linked securities (ILS) markets.
Artemis Update: AM Best has upgraded its outlook on the global reinsurance sector from stable to positive for the first time in over a decade, highlighting robust profit margins and improved underwriting conditions. The rating agency now views insurance-linked securities (ILS) as strategic partners rather than competitors, emphasizing their role in supporting traditional reinsurers. Despite a deceleration in reinsurance pricing, AM Best notes that underwriting discipline and healthy profit margins are expected to be maintained.
Exciting news in the world of finance and risk management! May is set to break records as the biggest month of catastrophe bond issuance ever. According to a recent article from Artemis, the market is experiencing unprecedented growth, highlighting the increasing demand for innovative risk transfer solutions.
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