Insurance against Kidnapping in India

Insurance cover against kidnapping has many takers


New Delhi, Aug 19 (IANS) Chander Lal, 52, an industrialist from Kanpur, is hesitant about telling his friends that he has taken an insurance policy for himself and his family against kidnapping, a growing 'industry' in the country's largest state.

Lal's foremost fear is that word might get around making him vulnerable especially with the kidnapping industry in Uttar Pradesh still thriving despite the crackdown against criminal gangs in the last three months.

But hundreds of industrialists and high net-worth individuals like Lal are increasingly coming forward to take up such policies as their businesses expand in crime-prone areas of Uttar Pradesh, Bihar and the northeastern states.

"Most of the requests are coming in from big contractors, industrialists and corporate honchos. Some of them stay in big metros but their industry or enterprise is located in areas where kidnappers hold sway," Santosh Balan of Bajaj Allianz, a private insurance company, told IANS.

"The policies we offer are not off-the-shelf products. They are tailor-made, confidential, and beneficiaries are given pan-Indian exposure."

Other insurance companies such as Tata AIG, ICICI Lombard and HDFC Chubb have also stepped in, offering similar polices with some even providing psychological counselling in the event of abduction.

According to the latest National Crime Records Bureau figures, Uttar Pradesh recorded 2,256 cases of kidnapping in 2006.

Figures received by the Patna High Court from district judges indicate that there were about 1,800 cases of kidnappings registered in Bihar in 2006 against 1,697 cases in 2005.

However, M.P. Gupta, a senior lawyer of the Patna High Court, put the figure higher saying that 4,849 cases of kidnapping took place in Bihar from July 2006 to June 2007. "This high figure of kidnappings in Bihar in one year is not mine or anyone else's. It is a court report and an authentic one," Gupta told IANS.

The indemnity policy of Tata AIG provides coverage for losses incurred as a result of kidnapping, bodily injury extortion (physical harm caused by extortionists), blackmail or property damage extortion (damage to property by extortionists) - including trade secrets, proprietary information and computer viruses and product contamination.

"Expert consultants help companies prepare for and respond to incidents in order to bring kidnap victims home safely and bring successful conclusions to extortion and blackmail situations," the Tata AIG website announces.

Because of the confidentiality clause, most insurance companies were reluctant to part with their customer portfolio, but according to police officials in Assam and Uttar Pradesh, leather goods exporters, contractors and tea estate owners had availed themselves of these policies.

Uttar Pradesh's additional director general of police (law and order) Brij Lal, who has over 100 encounters against his name, said he was unaware whether businessmen were taking policies but pointed out that his force had launched a massive crackdown.

"While it may not be possible to provide personal security to every single individual, strong action against criminal gangs has already brought down kidnappings by about 75 percent over the past three months since the new (Bahujan Samaj Party) government took over," Lal told IANS.

"Since kidnappings have been rampant in parts of western Uttar Pradesh, our special operations against criminal gangs in general has compelled several gangs to either lie low or slip out of the state."

"More recently, we eliminated one known kidnapping gang in Shahjahanpur, while our cops managed to get a hostage released unscathed from the clutches of another gang in the same district."

At a time when Bihar's kidnapping industry is thriving, the offer of insurance cover against kidnapping for ransom has come as a big relief.

Manorama Singh, a homemaker whose husband is an engineer in a top private telecom company, said that insurance cover against kidnapping was good.

"I was watching a news bulletin recently that insurance companies are offering cover against kidnapping for ransom in Uttar Pradesh. But I was told by my husband that companies will offer this in Bihar also," she said.

Fear of kidnapping runs high among the rich, many of whom cannot afford to pay the huge ransoms often demanded by kidnappers.

Professionals, businessmen and school students from well-off families are often the targets of kidnapping gangs. Just last week, Akash Pandey, 12, a Class 8 student was kidnapped while on his way to school in a posh Patna locality. The police are yet to find him.

A senior official of Tata AIG said the company would soon offer insurance cover against kidnapping for ransom in Bihar.

"We have been studying the market and business potential before launching it in Bihar," he said.

K. Ramalingam of Bajaj Allianz pointed out that the personal cover for the insured varied according to individuals and situations.

"It could start at Rs.5 million and go up to Rs.5 billion. There are many factors which go into drafting a policy. It is valid for a year like all other policies," he said.

By Murali Krishnan IANS