Special accident (kidnap & ransom insurance)
Kidnap and ransom insurance or K&R insurance is designed to protect individuals and corporations operating in high-risk areas around the world. K&R insurance policies typically cover the perils of kidnap, extortion, wrongful detention, and hijacking. K&R policies are indemnity policies – they reimburse a loss incurred by the insured. The policies do not pay ransoms on behalf of the insured. Typically, the insured must first pay the ransom, thus incurring the loss, and then seek reimbursement under the policy.
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
Judgement 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 the 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 travelling to dangerous places is not easily provided or is not obtained by small to mid-sized companies.
Life insurance is a contract between an insurance policy holder and an insurer, where the insurer promises to pay a designated beneficiary a sum of money (the benefit) in exchange for a premium, upon the death of an insured person (often the policyholder). Depending on the contract, other events such as terminal illness or critical illness can also trigger payment. The policyholder typically pays a premium, either regularly or as one lump sum. Other expenses, such as funeral expenses, can also be included in the benefits. Life policies are legal contracts and the terms of the contract describe the limitations of the insured events. Specific exclusions are often written into the contract to limit the liability of the insurer; common examples are claims relating to suicide, fraud, war, riot, and civil commotion. Modern life insurance bears some similarity to the asset management industry and life insurers have diversified their products into retirement products such as annuities.
Life-based contracts tend to fall into two major categories:
Protection policies – designed to provide a benefit, typically a lump sum payment, in the event of a specified occurrence. A common form—more common in years past—of a protection policy design is term insurance.
Investment policies – the main objective of these policies is to facilitate the growth of capital by regular or single premiums. Common forms (in the U.S.) are whole life, universal life, and variable life policies.