Explosive growth in kidnap for ransom in South Africa

11 Jun 2024
By Richard Hood CEO - OLEA South Africa
2024 2023 2022 2021

When The South African Police Service (SAPS) reports 51 cases of kidnapping for ransom in three months in South Africa, it has become a catastrophic problem. The South African Police Service (SAPS) reported a shocking 4 577 cases of kidnapping for ransom during the 3rd quarter of 2023. There are only 6 countries in the world that have higher kidnapping and ransom incidents than South Africa.

Kidnapping and ransom insurance in South Africa, like in many other parts of the world, is often sought after due to security concerns. South Africa, despite its many attractions and economic opportunities, faces challenges related to crime, including kidnapping.

Currently, the epicentre of the kidnapping crisis is the Gauteng province, the economic heartland of all of Southern Africa and home to Johannesburg, South Africa's commercial capital. More than half of the total cases so far have been reported from the province (7,818 annually). Gangs are now expanding to other parts of the country in search of new targets. At the beginning of March 2024, Nelson Mandela Bay in the Eastern Cape was identified as a hotspot. Four days later, businessman Neal Ah-Tow's was abducted from his shop and a R27 million price tag was placed on his life. Mercifully, he was released unharmed two weeks later, without a ransom being paid, albeit physically assaulted, disorientated, hungry, and traumatised.

‘The financial and psychological implications of a kidnapping can be staggering,’ says Richard Hood, CEO of OLEA South Africa. Ransom demands can run into millions. Associated costs such as negotiation fees, legal expenses, and medical care for victims can escalate rapidly.

Kidnap for ransom and the newly coined concept of ‘express’ kidnapping, is increasing exponentially on the African continent with a 30% year-on-year increase over the past decade in South Africa. Express kidnapping,’ involves criminal groups who kidnap and threaten people, then force them to withdraw the maximum amount allowed from ATMs or force them to open their banking apps to EFT funds. The kidnapping often ends when the victim can no longer withdraw money. But not always.

This exponential increase is associated with the rising levels of violent crime in the country, and it is no longer just High Net Worth Individuals (HNWIs) who are the target. Risk is determined by an individual’s location, community or nationality, vulnerability, and type of employment or business. That said, says Richard Hood, the CEO of OLEA South Africa, ‘everyone is a potential target. Kidnappers change the ransom demands according to what they think the victim, or their families, can afford.’

Most cases of kidnapping in South Africa are a side-effect of carjacking, robberies, and rapes but crime experts say an increasing number of victims are now being singled out directly.

Professional syndicates focus on smooth transactions and victims suffer less. However, copycat counterparts are more violent. The Institute for Security Studies (ISS) reported in 2023 that the main reasons for kidnappings are ransom, human trafficking, and extortion.
‘Additionally,’ says Hood, while kidnapping for ransom makes up only 5% of the criminal cases in South Africa, it still works out to around two people being kidnapped for ransom per day in the country. Part of the increase is attributed to the fact that two-thirds of the 21 million youths in South Africa are unemployed, so resort to crime to earn a living.’

Now, more than ever, companies and individuals need to proactively manage their kidnap risk and exposure by taking out specialised cover for such an event.

Although there is no way to protect yourself against kidnapping for ransom, there are ways in which you can mitigate the consequences of a kidnapping. Cover is available which provides additional protection for a range of expenses associated with a kidnapping incident and most policies provide assistance services, to manage the incident to secure the best possible outcome.

The impact of kidnap for ransom is devastating both financially and psychologically including:

  • Financial Impact: This can be staggering. Ransom demands can run into millions of dollars, and associated costs such as negotiation fees, legal expenses, and medical care for victims can escalate rapidly
  • Psychological toll: Kidnapping is a traumatic experience not only for the victim but also for their families and loved ones. The emotional and psychological impact can be long-lasting and may require extensive therapy and support
  • Legal complexity: Dealing with a kidnapping incident involves navigating complex legal and regulatory frameworks, both domestically and internationally. Having access to legal expertise and resources can be invaluable in such situations.
  • Comprehensive insurance coverage: For a range of expenses associated with a kidnapping incident, including ransom payments, negotiation costs, medical care, and crisis management services. Having this insurance in place can provide peace of mind and financial protection in the event of an abduction
  • Expert assistance: These professionals can provide guidance and support throughout the ordeal, from initial response and negotiation to securing the safe release of the victim
  • Risk mitigation: In addition to financial protection, many insurance providers offer risk assessment and mitigation services to help individuals and businesses identify and minimise the likelihood of kidnapping incidents

‘In conclusion,’ says Hood, ‘the threat of kidnapping in South Africa underscores the importance of having comprehensive insurance coverage tailored to address this specific risk. Beyond financial protection, such insurance provides access to expert assistance and resources essential for managing and resolving kidnapping incidents effectively.’

We are proud to announce that Richard Hood’s compelling article on Kidnap and Ransom trends in South Africa has been featured in FA News, Business Tech, and the esteemed Business Times.

The statistics cited are sourced from iTOO:
A specialised risk insurance provider, operating as Hollard’s preferred underwriter of speciality products.