17 Apr Are you at risk of kidnap and ransom?
With more companies expanding their operations in Africa, the risk of kidnap and ransom is real. Apio director Richard Hood discusses why more companies need to consider the worst-case scenario for travel in high-risk areas, and plan accordingly.
With a local economy in the doldrums, it’s no surprise that South African companies are increasingly looking to diversify their revenue streams by expanding into African countries. Nigeria is now purported to be the biggest economy in Africa, but doing business in this and other territories comes with high risk as well as potential reward.
Nigeria, Libya, Kenya, Mozambique and the DRC are all known to be hotspots for kidnap and ransom. And while it sounds like something only seen in Hollywood blockbusters, current worldwide statistics indicate that between 15 000 and 20 000 people are kidnapped each year – a startling figure. It’s a crime that appears to be on the increase, and particularly in Africa and in certain high-risk territories, people need to be vigilant.
Many of the incidents are not reported, for obvious reasons, and companies do not necessarily perceive a risk to their staff, particularly locally. However, the risk is heightened in Africa, where executives and senior management travelling in high-risk areas are potentially a target, as there is a perception that their companies are wealthy and can pay ransoms.
If you’re sending executives into a high-risk territory, Kidnap and Ransom cover is a logical choice. The cover has two components. The first, and probably the most important component is crisis management services, which assist in freeing the victim.
These crisis management companies have extensive experience on the African continent and have been very successful securing the release of hostages. They also assist with the consequences of the trauma that’s occurred to the victim and their family. With crisis management services in play, the family doesn’t need to fly into a high-risk territory and put themselves at risk to deal with the kidnappers.
The comprehensive policy also makes provision for trauma counselling, the costs of repatriating the victim, any permanent disability relating to the incident, and in the event of a death, a death benefit.
Kidnap and ransom insurance doesn’t pay the ransom. However, once a loss has been suffered, the insurance reimburses that loss. Understandably, confidentiality is the cornerstone of these policies, so much so that the company’s name isn’t even mentioned on the policy. This is to ensure that any ransom demand isn’t driven higher by the perception that because there’s insurance cover, more money is available.
When you’re investigating this kind of cover, your insurance company will ask what security protocols are already in place – whether you have a security escort in high-risk territories, for example. It brings the risks to the forefront in situations where you have to be careful and take the necessary precautions.
Undertake a risk assessment and evaluate which of your executives and senior management may be at risk for a kidnap and ransom attempt, and then speak to your broker about putting the appropriate insurance policy in place.