Marine Kidnap & Ransom (K&R) Insurance Exclusions

by F. Divecha
(London, UK)

Whilst Kidnap and Ransom (K&R) premiums are under stiff competition it should be noted that the buyer gets what they pay for. A Lloyd’s underwriter offering such cover has the following exclusion hidden away in the small print:

“This insurance shall not cover losses which would normally be insured under a standard Hull and Machinery, Protection and Indemnity, Freight Demurrage and Defence or War Risks policy whether purchased or not”

This looks like a perfect way NOT to pay a claim. As ever it is caveat emptor!

Kidnap and Ransom insurance should be part of a layered defence for owners, but protection of the vessel and its crew should always come first – companies like Maritime and Underwater Security Consultants (http://www.mandusc.com/services/ship-security.htm) have been around for many years and are always a safe bet.

This release is in response to the article on Reuters regarding Piracy premiums: http://uk.reuters.com/article/idUKLNE63001I20100401