Kidnapping and ransom insurance was created in the 1930s, but it wasn’t until the 60s that it began to really catch on, following a spate of kidnappings in Europe by groups such as Eta in Spain, the Red Army Faction in Germany and the Red Brigades in Italy. The appeal was simple: in the event of a kidnapping, the insurance would provide reimbursement for ransom payment.
There were caveats to prevent fraud and to ensure that the existence of the policy did not actually increase the risk of kidnapping. The first was that the policy had to be kept secret. In fact, it could be voided if its existence became public. The concern was that if the kidnappers knew of the policy, they would demand more money.
Read more [HERE].