But times change.
In 68 some heathens in Philadelphia booed Santa. And two years later someone did the unthinkable and sued Santa. The reindeer came in for a hard landing and damaged a few shingles on a roof. It was minor. But Santa got dragged into court mumbling all the way about no good deed going unpunished.
After that, Blitzen bit off a kids finger and the family was pretty frosty. The floodgates were now open. Insurance became one of Santas biggest expenses. He stopped delivering gifts to trial lawyers houses.
For the past four decades Santas insurance has been written by Arctic Insurance Group. But despite all of Arctics promises to bail him out of trouble, it has been quite the opposite. Santas success at getting claims paid has resembled that of the Cubs. And the reason for this is easy to explain for the past 33 years, Santas claims were assigned to the Insurance Grinch.
The Insurance Grinch found just about every way possible to disclaim coverage for just about every claim that Santa presented. His skills were unparalleled. When Santa began to get inundated with claims for knocking out Dish Network service with his sleigh, the Insurance Grouch disclaimed coverage on the basis of the aircraft exclusion. Wow! Now thats impressive.
Good news for Santa: The Insurance Grinch recently retired. Hes headed to Minnesota to enjoy the warmer weather. He bought a house in a neighborhood with lots of kids so he can tell them to get off his lawn. The Insurance Grinch agreed to give an exclusive interview to Coverage Opinions addressing a claims career like none other.
Coverage Opinions: Thank you Insurance Grinch for taking the time to discuss your 30-plus year career handling Santas claims. Were the other adjusters jealous that you handled such a fascinating and unique account?
Insurance Grinch: Very much so. But not because I was handling Santas claims. Because it meant that I didnt have to deal with any construction defect claims.
What was your favorite thing about handling Santas claims?
When you put on your Match.com profile for occupation that you handle Santa Clauss insurance claims, it makes a lot of people want to meet you.
What was the most common claim from Santa that you handled?
Thats easy. A kid would ask Santa for something like an iPad. And hed wake up on Christmas morning and find a sweater. Then, just as day follows night, in rolled the claim against Santa for breach of contract and detrimental reliance.
How did you handle these?
Well, there was no bodily injury, property damage or personal and advertising injury to trigger commercial general liability coverage. And several years ago, the North Pole Supreme Court held that when Santa opens a letter from a youngster, it qualified as the formation of a contract. I know. Its crazy, right. But its a liberal bench up here. But once the court found that an opened letter was a contract, it became easy to disclaim coverage since the professional liability policy has a breach of contract exclusion.
Tell me about that claim where Blitzen bit off a kids finger?
The kid was visiting Santa on a school trip and handing Blitzen a carrot. Except the kid was holding it in front of Blitzens mouth and the pulling it away. Holding it in front of his mouth and the pulling it away. The kid deserved it. Im pretty sure Blitzen did it on purpose. At least I hope he did.
Was it covered?
No. We had a reindeer exclusion in all of the policies. I know. It seems strange given that the reindeer are such an essential part of Santas operation. But Santa didnt read the policy. At least not until it was too late. And the broker was asleep at the switch. So we were able to get it in. And we have refused to take it out. Were the only insurer in the North Pole. So where else is Santa going to go?
What was the most expensive claim that you handled?
One year Santa was in someones living room, and his toy sack knocked a vase off a table. Turns out it was from the Ming Dynasty. Worth $2 million. The homeowners insurer paid for it. We were sure a subro claim would be made. We kept waiting but it never came in. Word on the street was that the homeowners carrier was afraid of the bad press from suing Santa.
Were there any unique liability issues involving Santa?
Many years ago, the North Pole Supreme Court held that Santa can be liable for a defective product under the Restatement of Torts 402(A). As you can imagine, this opened Santa up to massive products liability exposure defective BB guns, Easy Bake Ovens that start a fire, Parcheesi pieces that get swallowed. He was never able to get products coverage after that.
You dont get too many visitors up here. Seems like Santas premises exposure was pretty minimal.
True. Not many make their way here. No direct flights. But that didnt stop Santa from having premises liability exposure. Santa never shoveled the snow. He blamed a bad back, but I think he was just lazy. The mail man would come 10 times a day during the busy season, and constantly wipe out on ice while walking up Santas driveway. Santa knew it was going to happen. Finally, we said enough is enough and disclaimed coverage based on no occurrence.
Were there are claims that involve Coverage B of the commercial general liability policy?
One in particular. Santa would put a kid on the naughty list. The brat would turn around and sue for defamation. But we were successful in knocking these out of coverage on the basis that there was no publication of the kids naughty status. The only one who knew was the kid himself when he received the mandatory 10-day notice letter from Santa.
What about the elves. Did they ever cause any trouble for Santa?
Look, this was a big operation. At peak time, the elves work 16 hour days. What choice did Santa have? Work the elves to death or disappoint a kid in Cedar Rapids who wanted a fire truck. So of course, there were some wage and hour and overtime disputes. But we had an exclusion for this. The elves also got hurt fairly regularly. All the uncovered lawsuits required Santa to cut some corners on safety. Thankfully we didnt write the comp.
Did Santa ever damage any chimneys? Lets face it, hes not exactly svelte.
All the time. But that was an easy one to handle. Those claims fit right into the exclusion for property damage to that particular part of real property on which you are performing operations.
Any other interesting things about Santas risk program?
We require Santa to be an additional insured on all of the mall Santas policies. Not surprisingly, Santa sometimes gets brought into a suit against a mall Santa who did something stupid. But Santa didnt police their policies so he was never an additional insured. And we had an exclusion for Santas failure to secure additional insured rights.
Im starting to wonder were any claims covered?
Of course. Back in 98 we paid a claim. Wait. It might have been 97. A tyke fell off Santas lap. We looked at everything but just couldnt find a reason to disclaim. We thought about no occurrence since it seemed like faulty work. The kid is supposed to stay on Santas lap. He fell off. That sure sounded faulty to me. But in the end we settled and wrote a check. The policy had a pretty low sub-limit for claims arising out of, based on, in connection with or related to kids falling off Santas lap.
Have you been training your successor?
I have. But he still has a long way to go. On my last day in the office he got in a claim from a germaphobe family saying that Santa sneezed on their son. The kid is seeking medical monitoring for the rest of his life. The new adjuster was ready to appoint counsel. I said not so fast. Sounds like the pollution exclusion.
What advice did you give to your successor?
I explained to him that the vast majority of the claims come in the door in January and February. If hes doing his job, hell have them all disclaimed by the end of March. After that the key is to pretend to be busy for the next nine months.
This article originally appeared on Coverage Opinions.
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