That's an interesting one. I wonder if we'd see the kidnappings / torture market bifurcate: small players who nab someone to collect one month's disbursement, and larger players who now have a yield-generating business model of holding the person in perpetuity?

(Assuming there's some mechanism where the person is required for proof-of-life to get every month's disbursement. I can imagine a plausible way to do that, so let's roll with it.)

Although I guess also you could perhaps have a system where, if the person is kidnapped and held, the institution that does the disbursement would figure it out and turn off the yield? But they would have to credibly guarantee that outcome, or else create perverse incentives (the "negotiating with terrorists" thing).

Basically, we need this institution, or one like it, to be a credible wallfacer. (Freebie for you, @k00b.)