The “$5 Wrench Attack.” I was followed home from a crypto meetup. Three guys broke in, tied me up, and threatened to break my legs if I didn’t unlock my Ledger. I transferred $200,000. They left. My homeowners insurance covers theft, but they capped “Money” at $200.
Key Takeaways
- This is “Robbery,” not just “Theft”: Robbery involves violence/threats. While homeowners policies cover robbery, the limit on the asset (crypto) remains the bottleneck.
- Kidnap & Ransom (K&R) Insurance: This is the specific policy designed for this. It covers “Extortion” and “Surrender of Ransom.” It is designed for executives and high-net-worth targets.
- Life Insurance Implications: If you die during the attack, life insurance pays. If you are disabled, disability pays. But neither replaces the crypto.
- The “Duress PIN”: Your best defense is a Ledger feature where entering a specific PIN opens a different wallet with a small amount of funds.
The “Why” (The Trap)
The trap is “Unscheduled Property.”
Because crypto is treated as “cash” or “intangible,” the massive value isn’t covered by standard policies, regardless of the violence used to take it.
The physical trauma is covered (Medical Payments), the broken door is covered (Dwelling), but the $200k is gone.
The Investigation (I Quoted K&R)
I called a broker for a personal K&R policy.
Hiscox / AIG Private Client
- Coverage: “Cyber Extortion” and “Kidnap & Ransom.”
- Scenario: If you are held hostage in your home (Tiger Kidnap) and forced to pay, they reimburse the ransom/payment.
- Cost: Starts around $1,000 – $2,000 per year.
- Requirement: You must keep the policy secret. If you tell people you have K&R insurance, the policy is void (because it makes you a target).
Comparison Table
| Policy | Covers Medical? | Covers Stolen Crypto? | Cost |
| Homeowners | Yes (limit applies) | No ($200 limit) | Included |
| K&R Insurance | Yes (Crisis Response) | Yes (Ransom/Extortion) | |
| Umbrella Policy | No | No | |
Step-by-Step Action Plan
Set up a Duress PIN
On Ledger or Trezor, configure a secondary PIN that unlocks a decoy wallet with a small balance (e.g., $2,000). If threatened, give that PIN. They see funds, take them, and leave—while your main stash (e.g., $200k) remains hidden.
Stop flexing
Don’t wear crypto merch. Don’t talk about gains in public.
Consider K&R insurance if net worth > $1M
If your wealth is high and publicly known, Kidnap & Ransom coverage is worth having.
Home security matters
Reinforce doors and entry points. The goal is to delay intruders long enough to call the police.
FAQ
Does carrying a gun help?
That’s a personal safety choice, not insurance. From an insurance perspective, self-defense liability is covered by homeowners/CCW insurance.
Is K&R only for travel?
No. It covers domestic threats too.