What is Kidnap for Ransom Insurance?

Kidnap insurance comes with stringent conditions and access to a range of services for kidnap prevention and kidnap resolution. The market is highly concentrated: there are only around twenty underwriters in this niche business area and all of them operate syndicates at Lloyd’s of London. They have created common protocols to manage adverse selection and moral hazard among the insured and to order transactions across the legal/extra-legal boundary. These protocols are set, monitored, adapted, and enforced by a range of experts. The community of experts is small and cohesive and communication networks are dense. We observe a vibrant market for outstanding governance specialists. Good reputations and successful innovations ensure high incomes, but failures quickly lead to expulsion from the circle of trusted providers.