Creative commentary plus crafty composition

Out-of-the-Box Niche Insurance

Reflective of certain realities of modern life, a heretofore little known niche market of insurance protection is gaining awareness among financial professionals.

An article in the current month edition of The Insurance & Investment Journal discusses how kidnap and ransom coverage is being offered by a limited number of international insurers. The appeal is described as “growing amongst singles and families from middle class to high net worth who might be at high risk if members are volunteering, traveling, living or working abroad in unstable or high risk countries”.

What qualifies as the latter category in our current age would seem to be a gradually spreading arena. According to a global study, the ‘market’ for such coverage is expected to grow by nearly 50% in the next few years. This has produced increasing interest ‘in all types of special risk insurance’, covering vulnerabilities of kidnap, ransom, or extortion.

Included in policies typically are “ransom payments, access to a crisis management team, negotiator fees, reward for information money, medical and psychiatric care and legal liability coverage”. Given the pervasive nature of the internet, an additional option may be coverage for cyber attacks.

While there are obviously more elaborate issues from the standpoint of underwriting than with traditional life and disability – such as the location or duration of travel – probably the most unique aspect is that there is a contractual obligation with such insurance that it be kept in strict confidence. Knowledge revealed about a client’s coverage could increase the possibility of kidnapping for ransom.

Such a dramatic profile, unfortunately logical for some, version of insurance protection makes one wonder about smaller scale, less ominous offshoots which may emerge as niche potential for insurance providers. Daily life examples might include…

  • Place holding in line-ups: provides someone to cover one’s absence due to restroom needs or other issues requiring temporary absence
  • Home or auto repair delays: provides a steely-eyed negotiator to extract a better deal with a service provider who is unapologetically tardy
  • Trouser pockets or dress hemlines: on-the-spot repair for those cases of sartorial inconvenience
  • Bird or animal feces: removal and clean-up of messy, unhealthy droppings on person or vehicle, with an option to cover benches and picnic tables
  • Restaurant meal replacement: provides a qualified food inspector to check that meal items which need to be redone do not suffer any resentful, undignified response from staff

Appealing about such types of protection is that they’d be less complicated and less costly.

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