An insurance company is investigating offering kidnap and ransom insurance. Policies are to be sold to multinational companies to provide cover for certain named employees who are based in or travel to a range of countries. The cover provides protection against losses incurred by the company and its employees (or their families) in the event of an actual/attempted kidnap or hijack.

The main benefits include:

• Reimbursement of ransom.
• Insurance against loss in transit of ransom.
• Insurance for additional outgoings, which may arise as a result of a kidnap or hijack.
• Payment of medical bills for actual injury or psychological care.
• Compensation for the stress and trauma suffered by employees or their families, for example as a result of threats made.
• Compensation for damage to property of the company or its employees.

(i) List the information that would be requested on the proposal form to aid in underwriting the policy.

(ii) (a) Describe the conflicts of interest that could exist between any of the insurance company, the employer and the employee.

(b) Explain how such conflicts could be reduced.

(iii) Describe how the insurer could provide assistance to its clients to help them manage or mitigate the risks covered under the policy.