Breaking the Invisible Chains with Policy: How Insurance Companies Can Help End Human Trafficking in the Hotel Industry

Human trafficking in the hotel industry represents a hidden threat that demands decisive action. Despite public commitments, the sector's initiatives remain inconsistent, and a wave of lawsuits imposes both financial and reputational risks. Through analysis of relevant legislation and case law, the article demonstrates hotels’ potential liability as venues enabling trafficking. However, inconsistent self-regulation and lawsuits reveal limited progress. The authors advocate for insurance companies to play a pivotal role in combatting human trafficking in the hotel industry by strategically adjusting coverage provisions. They trace the historical influence of insurers on the trajectory of slavery when 18th century British insurers’ actions contributed to the rise of abolitionism and argues that similar private regulation today can incentivize hotels’ proactive measures against trafficking. The article proposes that insurers possess diverse tools, including exclusions, premium adjustments, auditing, and loss prevention, to compel action rather than complacency. Mandated self-insured retentions can also hold hotels financially accountable for their negligence. However, relying solely on pricing alterations faces challenges due to market competition and inconsistent judicial rulings on liability exclusions. Ultimately, addressing this complex issue requires a collaborative, multi-stakeholder approach. Government fines and prosecutions can further incentivize self-disclosure and cooperation, while publicized settlements can promote transparency and empower consumers to make informed choices for hotel venues. This combined framework can transition hotels from passive enablers to active contributors in the fight against human trafficking, fulfilling their duty of care and catalyzing meaningful progress against human exploitation