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Julie (00:00):

All right. Welcome back to The Risk Rundown. I am Julie Rison, and as always, I am joined by Tyler Banks. Tyler, hello.

Tyler (00:24):

Hi, Julie.

Julie (00:26):

Okay. One of the things that we've talked about quite a bit lately is how much personal risk has changed and evolved over the decades, right? About how much technology kinda goes alongside with what we do and our daily lives, and about how we communicate, and the information that we share online with social media, and all these people now kind of know what we do in our lives.

That didn't necessarily exist, quite a few decades ago, right? And as you and I were talking, previous to recording, we talked about this topic of kidnap and ransom, and you brought up a great story regarding Frank Sinatra and what actually happened to him, and I think it actually is a really good example about how exposures have changed, over the decades.

Could you kick us off with that story?

Tyler (01:15):

Sure. Probably the most notorious kidnappings was back in the 1960s, and it was Frank Sinatra's son. Frank Sinatra Jr., who was 19 years old and was touring at the time, in Lake Tahoe, two individuals—B-list criminals, not overly sophisticated—knocked on his changing room door pretending to deliver a package, kidnapped, this 19-year-old kid.

There was a ransom demand, I think, of a quarter million dollars. Back in the 1960s was

Julie:

That's a lot of money ... 

Tyler:

A tremendous amount of money. And so Frank Sinatra Sr., on his own, went out and was desperate to get his son back, right? As anyone would be. To the point where he actually offered, I think, a million dollars.

Ultimately, the ransom was paid, and he got his son back. But two things I think we learned from that lesson. Number one, if you're an overly emotional parent or relative involved in a kidnapping, you are not the right person to negotiate the release of that individual, right? Yeah. It's too emotionally charged.

You are too caught up in the situation to make a rational decision. It's really important that you bring in a professional, which is what a K&R policy does, right? The professionals, the people that know what they're doing. They do this on a daily basis. And number two, they knew where this individual was gonna be, right?

A widely publicized tour of where the person was gonna be and the date. Fortunately, that is a story that ended with no loss of life. But there was also an emotional impact, on that as well. And a K&R policy often times will also cover counseling and getting your life back online and, maybe even creating a better security protocol for you and your loved ones.

A lot of lessons learned from that story. But again, this happened in the 1960s, and the world has evolved since then.

Julie (03:13):

There was no online presence back in the 1960s, right? So it had to do with lifestyle. It had to do with publicity and notoriety. It had to do with that kind of stuff.

I mean, this has been going on for a really long time, but to your point, between online presence and the information shared online, shoot, like, acquisitions of property, right? That if it's just announced that you just purchased a multi-million dollar home in South Beach, Miami, and all of a sudden somebody sees that, you're gonna be a target, right?

And so all of this online information and the lifestyle that you lead all leads to, unfortunately, some susceptibility that you might not be, and some attention that you might not be looking for.

Tyler (03:59):

You know, when we first started, when I first entered the industry and we talked about kidnap and ransom, it was very kind of like you're getting kidnapped off the streets and you're in some foreign country and what do you do?

I think that was the initial premise of what K&R was all about. But as society has moved and with digital footprints expanding, I think we're starting to see different types of kidnappings, whether they're express kidnappings or virtual kidnappings, right? We've got, a new sense of K&R and what it means, Julie.

Julie (04:33):

You talked about the express kidnapping. Express kidnapping is kidnapping when somebody takes someone for either a short period of time, either hours or maybe a day or two, and within that time period, they're requiring that person to either go to ATM, or now you have Venmo, you have Zelle, you have PayPal, you have all these, to get money and transfer those funds, right?

Or it could be that they are calling their relatives and saying, "Hey, I have this person, and you have to give us money within 12 hours or else." For security purposes, there's nothing really that you can do about that kind of stuff.

Tyler (05:00):

I don't know if I told you, but this actually happened to my own family, the virtual kidnappings. My father received a call who, with an individual that purported to be my nephew, and he was saying he was in an accident, and he needed money transferred to him immediately.

A couple of things here, right? First of all, how did this individual get my father's number? Number two, how did this individual even know that my nephew was related to my father?

A couple of things to learn here, Julie, is that these criminals are lying in wait. They are doing their due diligence. They are doing their research. They're finding out who your family members are. They find out where you're exposed.

And thankfully, my father had the wherewithal to call this individual out, for trying to extort him for some immediate money.

He asked him, he said, "Why does your, you know, voice sound different? Why do you sound different?" And his response was, "Oh, I just got into an auto accident. So that's why my voice sounds different than it normally would. I need you to get me this money right away." So kind of a panic, frantic type of environment.

And listen, if it happened to my father, it could probably happen to you. It could probably happen to other individuals or loved ones, if you're not diligent in kind of protecting yourself.

Julie (06:40):

Well, and that's why some people say, some families say you need to have like a safe word, right? So that if somebody is in danger, that you ask that person, what is the safe word so they know it's banana split or whatever it is, right?

That they know that terminology or they know that phrase or they know that word so that they know for sure that it's that person. One of the things I would love to ask you is what do you think is one misconception that people have about K&R?

Tyler (07:00):

I would say probably one of the biggest misconceptions about a K&R policy is that they sit around with piles of cash in a suitcase ready to pay out some of these ransoms. Like the movies? 

Julie (07:21):

There was, there's

Tyler (07:22):

There's been movies that- Yeah, just like in the movies, right? Yeah. In the movies you got-

Julie (07:24):

Yeah.

Tyler (07:24):

Yeah, you're meeting someone on some obscure bridge in the middle of nowhere, and you're doing an exchange for an individual with a pile of cash. In actuality, a K&R policy is more like an indemnification policy, meaning that it's a reimbursement.

If there is a settlement, for a dollar amount, it's usually something that the individual needs to go out and get like a short-term loan for and/or, we're seeing more of it being digital currency, right? Cryptocurrency. Bitcoin ... so something that... Yeah, Bitcoin, exactly. Bitcoin, other types of cryptocurrency is the new form of ransom payments that you see a lot of these K&R policies doing.

Here's a question for you. When you think about exposure, who tends to be the most vulnerable, Julie?

Julie (08:14):

I think historically people have always thought it was people that travel a lot, right? And that's not the case anymore. I think the people that are more susceptible to it are gonna be people that are not being aware of their surroundings.

People think that it couldn't happen to me. And honestly, it could happen to any of us. There was someone that had said recently, "If you can get burglarized, you can get kidnapped." Any one of us can actually be susceptible to this.

Tyler (08:43):

Yep, good point. Julie, what's the biggest blind spot that you see when families think about personal security?

Julie (08:53):

I think that they think that it's only the dangerous countries, that are the ones that need security or that you need to have your antennas up, or that you need to be cognizant of your surroundings. And honestly, domestic kidnapping is actually one of the most prevalent at the moment.

Tyler (09:00):

For someone that has never thought about getting a K&R policy, what does that typically look like at a high level?

Julie (09:21):

Well, I mean, honestly, it's usually a separate policy, right? It's separate coverage. There can be endorsements that can add on a little bit of here, a little bit of there.

But typically, in a robust type of policy, it's a separate policy. And those types of policies will cover typically anyone that you are traveling with. It could be your spouse, your family, your children. But on the application, it will actually ask what your net worth is. It will ask what countries you plan on visiting, right?

Because there are gonna be stipulations on where you can go, that there's gonna be coverage for that stuff. It's not just automatically included on your homeowner's policy, right? Or your umbrella policy. You need to be asking your agent about that kind of stuff if that's something that you're concerned about.

Tyler (10:00):

You bring up a good point on maybe some of the restrictions that you have in some of these policies. Because, everyone jokes that insurance is, it's covered until it's not, right? Yeah. And there's all these pages of limitations. I mean, most people don't drive around highlighting how much umbrella coverage they have on their car, right?

There's not a bumper sticker, "I have a $10 million umbrella policy. Come hit me." In a K&R policy, there's a clause that if you disclose that you actually have a K&R policy outside of a very small, tight-knit, trusted group of individuals, that there could be an exclusion in place. They don't want you broadcasting.

They don't want you letting other people know that you have a policy. And if you're out there publicizing that you just got a K&R policy and you travel internationally and something were to happen, and they may deny a claim, if you had actively publicized that you actually had a K&R policy. It's really important, and when you place the K&R policy, they kind of go through some of those limitations.

What's another kind of thing that you may see, Julie, that would prevent a K&R policy from kicking in?

Julie (11:20):

Well, I mean, it's gonna be fraudulent stuff. It's gonna be the normal stuff, right? It's gonna be, you can't be fraudulent. You can't have somebody, you can't plan it and have someone, fake a kidnap threat to you and then have a policy pay out.

Tyler (11:36):

I was gonna say that you brought up a good one as well on sanctioned countries.

Julie (11:42):

Yeah.

Tyler (11:42):

Right? It's important that you're not traveling to places like Iran or North Korea. Where if it's a sanctioned country, the government's saying that you can't go there, or if there's hotspots, as we know right now around the world there's plenty of hotspots, it's really important that you are up to date and your knowledge is aware of where you can and can't go.

Because if you go to one of these sanctioned countries, there's a good possibility again that your coverage may be null and void.

Julie (12:12):

It's not a sanctioned country, but the country that is a hot topic at the moment is Mexico.

Tyler (12:18):

Mm-hmm.

Julie (12:18):

A lot of different resort areas within the country of Mexico unfortunately, as wonderful as those places are, it can be a hotspot, and a hub for this type of action.

And you and I have talked about that people have a tendency to go back to places that they like, right? And, if people are vacationing to a resort or to an area that they have vacationed for the last 20 or 30 years and they know the concierges, they know the restaurants that they go to, they have the same routine that they go to the same places every time they go visit.

When you have that familiarity, which is great, but on the flip side of that, it can be a huge detriment because you're now having a routine. So it's those types of things that people really have to kind of take into consideration. Change up your routine. Change up the places that you go to. You can't necessarily always trust the people that you think that you can trust because you've seen them for the, once a year for the last 15 years, right?

Tyler (13:00):

Routines, changing it up. A lot of us are creatures of habit, Julie, and it's very difficult to go outside of that routine. But again, if you're high profile, if you are an ultra high net worth individual, routines are things that criminals specifically look for.

Number two, Julie, and actually this may, this should be probably number one, is post-date your vacations, right? Post-date where you've been. Everyone loves to see where you, where you're at and what you're doing. Just wait till you get home and then post that, and then you can share, "Hey, I was in, you know, in Mexico doing this. I was in Europe doing that. I was in a safari in Africa."

All wonderful and great things, but just delay that post until you get back. That is one easy, clear, clear thing that you can do to protect yourself. We've talked a lot here Julie on some high profile kidnappings.

We've talked about some precautions people can be taking to protect themselves. Is there anything on a K&R policy that you think warrants additional discussion here?

Julie (14:30):

I think it's just important to get the right agent and to have a conversation with your agent, right? It's something that we actually have conversations with our clients about.

It is about not necessarily just protecting the amount, the ransom, the money that you would be paying out, but it's actually protecting your family and the people that you care about. Again, if you can be burglarized, you can be kidnapped. So I think that it's important that we all kind of take that information and we reach out to those people that we trust that can give us some advice and at least, look at the different options that we have, in the insurance industry, in order to be able to help in those very stressful times and situations.

Tyler (15:00):

And Julie, I think that it's also important to note that if you're traveling on vacation with your family, right? It's a protection of your loved ones. Again, it wasn't, "I'm going to kidnap Frank Sinatra Sr., I'm going to kidnap his son."

Julie (15:30):

Yeah.

Tyler (15:31):

Right? Knowing that he would do literally anything to get his son back.

And so, it's the individual themselves, they may take all sorts of precautions, but it's the family members and your loved ones that you need protection for. Again, if you're exposed, if people know that you have money, if you are traveling regularly, and an individual K&R policy will cover you and your loved ones.

Julie (15:55):

Exactly. We could go on and on with this one, but I think the biggest takeaway, honestly, is that it isn't about creating fear, right? And that we should be traveling and being scared all the time, but it's about how the world has really changed our surroundings, and the information that we should  and should not be sharing.

We need to start to recognize that and have a little more due diligence. These events are still, I would hope rare, but we need to be prepared and be aware about what's going on in our surroundings. With that being said, I wanna thank everyone for joining us for The Risk Rundown episode, and as always, stay safe and stay protected.

01:15 — Lessons from the Frank Sinatra Jr. kidnapping
One of the most well-known kidnapping cases in history highlights two enduring lessons: visibility can create exposure, and emotional decision-making during a crisis can complicate outcomes. The case also demonstrates the value of experienced crisis response professionals.

04:00 — Understanding today's kidnapping threats
Kidnap and ransom risks now extend beyond traditional abductions. Modern threats can include express kidnappings, virtual kidnappings, and other schemes that leverage technology, a sense of urgency, and personal information to pressure victims and their families.

05:00 — The tactics behind family impersonation scams
A real-life example shows how criminals impersonate loved ones, create a sense of panic, and demand immediate payment. Criminals often conduct extensive research beforehand, making awareness, verification procedures, and family communication increasingly important.

09:40 — What a Kidnap & Ransom Policy actually covers
Kidnap & Ransom coverage is typically purchased as a standalone policy and extends beyond financial reimbursement. Coverage often includes access to experienced crisis response consultants, support for family members, and resources to help navigate highly stressful situations before, during, and after an event.

12:30 — Travel patterns, hot spots, and reducing vulnerability
Travel destinations, predictable routines, and real-time social media updates can all increase visibility. Taking simple precautions, such as varying daily routines, understanding regional risks, and delaying vacation posts, can help reduce unnecessary exposure while traveling.