The brutal stabbing of an American School teacher in Abu Dhabi – allegedly at the hands of a Muslim extremist – highlighted the potential danger of living abroad, and why more people are now applying for “war zone” insurance when traveling to hazardous places. YaKenda McGahee reported this story from Los Angeles.
War Zone insurance provides peace of mind in war torn countriesThe brutal stabbing of an American School teacher in Abu Dhabi - allegedly at the hands of a Muslim extremist - highlighted the potential danger of living abroad, and why more people are now applying for "war zone" insurance when traveling to hazardous places. YaKenda McGahee reported this story from Los Angeles.
When Abu Dhabi police arrested a woman, they suspected she had stabbed one American to death and was about to blow up another. For some, instances such as this makes the world feel less safe.
“Anything can happen anywhere, in any city in the world, and I’ve always felt very comfortable in Dubai and Abu Dhabi,”Nancy Ray, Expatriate from Denver, Colorado said.
Sentiments like that have been good for the insurance business. In the last six months, applications shot up 125 percent for policies covering life in hazardous locations.
“One of our largest areas is the war-risk business coverage,” Thomas Petersen, Exec. Vice-President Petersen International Underwriters said. “They can be private contractors. We also have a lot of groups like missionaries because they’re in war-risk areas.”
For a 40 year-old living in France, a million-dollar term life insurance policy would cost around $800 a year. The same coverage for a 40 year-old in Syria would cost $8,000, around ten times more.
For a journalist, the late James Foley for example, the price would be higher, but it’s doubtful any amount of insurance could have spared him his fate at the hands of ISIL.
Insurance might make more sense when a kidnapper’s motivation is money.
“I’m not sure if you ever saw the movie ‘Proof of Life.’ There’s a kidnapping that occurs a housekeeper says, I have this friend that can help with negotiating. Well that person was involved with extorting them,” Petersen said. “That’s more real than not real. You want someone who’s an expert in that area to help with the negotiation process, establish proof of life, that’s why the response team is so important and that’s why the coverage is so good.”
Many insurance companies won’t pay if a policy holder dies from an act of war or terrorism, but that started to change when Malaysia Airlines Flight MH17 went down over Eastern Ukraine.
After the crash, at least two insurance companies waived their policy payout exemption for death due to armed conflict. Why the plane went down is still under investigation.