News Release


Kidnapping for Ransom and Extortion on Increase

Organisations have a duty of care to safeguard their travelling employees

Aon South Africa has issued security warnings to its clients via its WorldAware Operations Centre regarding a state of emergency declaration in Kaduna, Nigeria following a spate of kidnappings for ransom. The Kaduna State Police Command declared a State of Emergency on Tuesday 5 April 2016 to combat the spike in kidnapping cases in the state.

The state police command announced that an anti-kidnap squad task force has been established to track and locate the criminal gangs suspected of engaging in kidnapping for ransom. Over the last three months, there have been several cases of kidnap for ransom and extortion, with the most prevalent being a Colonel in the Nigerian Army who was killed by his abductors after he was taken on March 25.

"Travellers are recommended to arrange transport through trusted and well-vetted sources. Travellers should also avoid displaying any unnecessary signs of wealth or affluence. Travellers and employer and support organisations must allocate realistic contingency plans in place to cater for impromptu travel disruption. Travel by road should only be undertaken in daylight hours with robust travel management and assign secure escorts due to the risks posed by armed robbers. Where possible, undertake medium and long-distance travel by air. Vary routines, be discrete with your itinerary and be alert to possible signs of surveillance by third parties," says Andre Van Tonder from Aon Sub-Sahara Africa's Crisis Management Team.

Aon's WorldAware Operations Centre in Johannesburg supports its principle WorldAware Operations Centre in Chicago. The aim is to supply clients with more regional specific information around Sub-Saharan African countries in addition to conducting risk assessments and travel risk related research and analysis. The risks that travelling employees face is growing in frequency and magnitude and includes health and safety risks, unpredictable natural disasters such as floods, fires and earthquakes, violent crime due to increasing social and economic divisions within countries and most concerningly, terrorism and political violence.

Emerging markets are increasingly kidnap and ransom hotspots

Dani Ettridge, of Aon South Africa adds that there are an estimated 15 000 to 20 000 kidnap for ransom and extortion incidents every year, but the reality is that many more go unreported. Recent events in Nigeria and Yemen have refocused global attention on what is a terrifying, often terrorist-linked practice of raising funds for arms or political gain.

"Emerging markets which are experiencing significant growth and foreign business activity provide fertile ground for such incidents. Kidnap patterns in Africa particularly show that expats from international companies and the personnel of international aid organisations are likely victims due to the high profile and perceived wealth of the company they work for. But even the South Africa environment with its perceived low levels of law enforcement is conducive to the kidnapping of professionals," warns Dani.

The impact of a kidnapping can be enormous. It is extremely traumatic for those involved and dealing with an incident can lead to significant losses from ransom payments, business interruption, litigation, adverse publicity and long-term reputational damage. Every corporation with cross-border operations should consider protecting themselves and their staff against the risk of kidnap, extortion, detention and hijack.

Aon WorldAware Solutions provides travel risk analysis, safe travel policies, training and awareness, risk managed travel and incident response, incorporating the management of all travel risk exposure into one system that wraps around existing insurance policies and relationships. The importance of having an on-the-ground incident response team backed up by risk mitigation measures and insurance cannot be emphasised enough.

Kidnap, ransom and extortion cover

Due to the massive sensitivity of such risks, confidentiality is an utmost priority and it is a firm condition of kidnap for ransom and extortion (KRE) insurance policies that the existence of the policy cannot be revealed to a third party nor all employees.

"While KRE insurance provides financial security that any ransom paid will be reimbursed, the real value behind having KRE insurance is not the money. KRE policies provide unlimited access to a specialist response consultants and crisis teams to assist in dealing with a covered event. Their advice and support to the victim's family throughout such a traumatic incident is invaluable," explains Dani.

The role of the risk advisor in reviewing and advising on the types of cover for specific regions is also paramount as KRE is a developing type of cover and not all policies are the same. Policies have had to evolve and adapt to changing conditions and environments and insurers have added on various extensions that adapt to the evolving elements of personal accident and injury involved with this crime.

"Kidnap victims can be held for months or even years which means that the company would need to consider salary replacements for the time that the executive is not there, as well as consider loss of earnings for the company or the family. An event such as kidnapping could also trigger certain business interruption concerns and there is also an emerging risk of potential emergency political evacuation of employees that a company could be required to carry out," she adds.

The modus operandi of KRE is also constantly shifting. Some insurers and negotiators have reported that "express" kidnappings are on the rise – unlike the more protracted cases of some piracy attacks, these involve fast, targeted grabs with shorter periods of detention and smaller ransoms. Other negotiators reported that their most serious cases have been more protracted and the kidnappers more patient.

"While having the financial security to manage such an incident is paramount, insurance alone does not reduce the chance of being kidnapped. Prevention and pre-emptive risk management has to be the first port of call including reducing vulnerability to attack and comprehensive training for personnel who travel to high risk locations. After all the prevention work is done, at the very least KRE cover provides companies peace of mind that their people and reputations are protected in the result of a covered event and that they will have professionals to help them through," explains Dani.

Always be prepared for a crisis

Organisations have a duty of care to safeguard their travelling employees. This includes monitoring country threat levels, preparing personnel prior to travel, being able to locate travellers and having procedures in place to react to travel related incidents, from the routine to the extraordinary.

"When a travelling employee is in crisis, how quickly and effectively the company reacts is critical – whether it's a kidnapping, a sudden unexpected and serious illness or a natural disaster. It can mean the difference between recovering or not at all for both the employee in crisis and company," concludes Andre.

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