Protecting your only irreplaceable assets

14 March 2017

Global workforces are facing a fast-growing spectrum of risks. In this article we look into the duty of care firms have for their staff if disaster strikes.

Terrorism, the migrant crisis and political instability are just some of the factors that make travelling in the current environment a risky business.

Yet the risks are growing. Global businesses are increasingly branching into new territories, and mobile technology makes it easier than ever before for staff to work abroad.

As such, an expanding number of employees are exposed to potentially life-threatening situations.

“In order to compete, and to take advantage of business opportunities, multinational companies are often having to operate in more remote and/or volatile regions,” says Tom Howard, Kidnap & Ransom Underwriter at Talbot Underwriting.

The types of risk that a global workforce can face

Risks in more remote or volatile regions can range from man-made and natural catastrophes, to civil unrest, war and criminal activities such as terrorism, kidnapping, extortion and hijacking. Risk is often heightened in areas of dense population or heavy industrial activity.

According to NYA International, Asia and Africa are the two most common locations for kidnapping. The Emergency Events Database (EM-DAT) also cites these locations as hot-spots for technological disasters.

The 2015 Tianjin Port explosions in China, and the 2011 Fukushima nuclear disaster in Japan, are two examples of major industrial incidents that put thousands of lives at risk on the ground. Having been triggered by a tsunami, Fukushima illustrated the potentially devastating link between natural and man-made catastrophe risk.

Meanwhile, the increasing connectedness of societies through social media is enabling terrorist activity and civil unrest to spread quickly in major cities. As last year’s tragic terrorist attacks in Paris demonstrate, an evacuation situation can arise at any time, in any location.

Insurance protection lacking for the global workforce

Some companies may be leaving themselves inadequately covered against the risks that today’s global workforce is exposed to – with potentially disastrous human, financial and reputational consequences.

“Every organisation is exposed to one or more of these risks, and so they should have cover in place,” says Sam Aiken, Head of Kidnap & Ransom (K&R) at JLT Specialty.

“It might be stand-alone K&R or evacuation policies, or a more comprehensive global emergency response policy for staff exposed to a broader risk spectrum.”

Kidnap & Ransom policy

Standard K&R policies typically cover a range of risks, including  K&R, extortion, disappearance, hostage crisis, personal accident, cyber extortion and malicious product tampering.

Coverage can be built upwards depending on the specific needs of the insured, with common extensions, including threat or stalking cover, identity theft, and emergency political evacuation, usually limited to political events such as the Arab Spring.

duty of care infographic

Global Emergency Response policy

This year, JLT partnered with Talbot Underwriting to create a broader Global Emergency Response (GER) policy.

As well as providing standard K&R cover and extensions, the GER policy covers evacuations due to security issues, war, civil war, natural disasters and industrial catastrophes – the latter being a unique coverage in the market.

“Many companies now want a one-stop-shop solution: a policy that provides a single point of response which can solve a number of insurable risks,” says Aiken.

While every organisation insures against losses to the balance sheet and physical assets, only some cover their only irreplaceable assets – their staff – under a group personal accident or travel policy, Aiken explains.

But he warns: “This overlooks low frequency, high-impact events. Having the right cover in place is a tangible demonstration that the company is showing a duty of care to its employees.”

Preparing for the worst

According to Howard, evacuation attempts during the Arab Spring highlighted weaknesses in many global response companies’ capabilities, as they were often unable to mobilise evacuation teams quickly enough.

Under the GER, insureds are protected by Northcott Global Solutions (NGS), a primary response specialist that coordinates pre-vetted, locally based teams around the world.  So response teams are already on the ground, rather than having to be scrambled from an international base.

“The NGS operations room can mobilise a response in a matter of hours, rather than days. When it comes to evacuation situations, that’s a critical differentiator,” says Aiken.

Mitigating risk to staff travelling abroad

“Organisations can always do more to mitigate risks and prepare for the unforeseen,” says Aiken.

Some of the risk management measures that a multinational firm can put in place to mitigate the risks to their staff in a foreign country include:

  • Create a pre-travel plan – this can ensure that staff are vigilant when abroad and prepared for an emergency.
  • Provide travel risk information and safety awareness training to staff they intend to send abroad – this should include crisis management planning and situation rehearsals.
  • Use online tools – these can help a company to provide real-time risk information and protection for their employees when abroad. For example, NGS provides an app that includes pre-loaded security information; requires no internet connection; and has a panic button that connects the individual with the ops room.
  • Consider a policy that includes an online platform – for example, JLT Frontier provides live alerts and updates on security issues across 215 countries and territories, for those with a Hiscox policy.

It’s essential that organisations take responsibility for their own security measures, according to Howard.

“They may assume they’ll be supported by diplomatic services in the host nation. But in many countries, these resources are stretched, and it’s difficult for their governments to look after a diverse community of international businesses.”

Criminal activity, civil unrest and catastrophes are hard to predict and can be impossible to avoid. However, preparation, planning and insurance protection can significantly reduce the impact of such incidents on an organisation and its employees.

For more information please contact Sam Aiken, Head of Kidnap & Ransom on +44 (0)20 7528 4204 or email