The 11 insurance policies that Santa should have
December 7th, 2011
Kathryn Hawkins
Christmas is coming, and children all over the world are anticipating Santa Claus flying through the sky with his team of reindeer and sleigh full of gifts. But before that jolly white-bearded fellow embarks on his worldwide chimney-hopping journey, he’ll need to consider something pretty important: protecting himself and his assets. The right insurance can help him do that.
Here’s a breakdown of the 11 types of insurance that Santa Claus should buy.
1. General liability insurance.
John Couture, a State Farm insurance agent in Gray, Maine, recommends that Santa buy a general liability policy. This will protect him if he’s sued for causing injury to someone who visits his place or for damaging somebody’s property. “It’s icy up there in the North Pole, so it’s important to protect him against lawsuits for slips and falls,” Couture says.
 |
| Santa Claus probably should make a list of all of the insurance coverage that he needs — and maybe even check it twice. |
Liability insurance also can protect Santa in case of lawsuits related to damage to homes that he visits on his present-delivery missions, such as broken coffee tables or chimney-soot-stained carpets.
Because Santa works with children, it’s important for him to get a liability policy with high limits. It’s a sad reality, but sitting on Santa’s lap could easily lead to a lawsuit. “A group of children could get together on a scam to accuse Santa of sexual abuse allegations,” Couture says.
Additionally, Santa needs bodily injury liability coverage with limits that at least meet the insurance industry’s minimum standard. In the insurance world, the minimum recommended limit is known as 100/300. That stands for $ 100,000 per person in coverage or $ 300,000 per incident.
“A reindeer-driven sled is a dangerous instrument, and several states have strict liabilities on owners of animals for injuries they cause,” says Russel Lazega, an insurance litigation attorney in Miami.
This coverage would be on top of liability coverage provided under his home insurance policy.
2. Home insurance.
In light of the sometimes treacherous weather at the North Pole, Santa certainly will want to have home insurance to protect the household that he shares with Mrs. Claus. You never know when a storm might damage the Claus “castle.”
3. Life insurance.
If Santa works for a corporation, the shareholders likely will want to take out a large life insurance policy on him, since he’s a “key employee” and would be costly to replace, Couture says.
If Santa is an independent business owner, though, he should purchase his own life insurance policy, with Mrs. Claus as a beneficiary. That way, she can continue to finance the North Pole operations and hire a replacement sleigh driver in the event of Santa’s demise.
4. Workers’ compensation insurance.
Santa’s elves have been toiling away at making toys in Santa’s workshop. What if one of the elves sliced his thumb while carving a wooden truck? Workers’ compensation insurance should cover the medical bills of employees who injure themselves on the job. But the policy is likely to be expensive. “The elves are involved in manufacturing, which is a dangerous business,” Couture says.
5. Health insurance.
Santa, Mrs. Claus and all the elves should be covered by health insurance coverage under a group medical policy. “They’ll get a good deal, because there are so many elves,” Couture says. The policy should help Santa pay for medicine to treat the diabetes and other health conditions that could be triggered by all those cookies.
“I’m worried about Santa’s health,” says Bob O’Brien, an agent at Noyes Hall & Allen Insurance in Portland, Maine. “That ruddy complexion, that ‘bowl full of jelly,’ all those milk and cookie snacks, the late hours and high-pressure delivery schedule — the man’s a sleighing time bomb.”
6. Disability insurance.
To keep the business going if Santa’s health heads south, he should purchase a disability insurance policy. This will pay him (in milk and cookies?) enough to compensate another employee to do his job while he’s out of action, O’Brien says.
7. Specialized insurance for Santa’s sleigh.
Santa’s flying sleigh is his only mode of transportation. So it’s essential that he has a good insurance policy to protect it against theft, damage and collision. However, his sleigh likely won’t be covered under a traditional vehicle policy. “He may need to get a special policy under Lloyd’s of London, which insures specialized items such as actresses’ body parts,” Couture says.
8. Livestock insurance.
Although Santa doesn’t technically run a farm, he does own livestock: his eight flying reindeer. In case some Grinch grabs Donner, Dasher or Rudolph, Santa should invest in a livestock policy with enough coverage so that he could buy new reindeer, Couture says.
9. Veterinary insurance.
Because Santa’s reindeer are so important to his job, he should make sure they’ve got full coverage for veterinary care, Couture says. That’s in addition to the livestock policy. After all, if Rudolph came down with the flu two days before Christmas, Santa would need the best of care to get him back into flying shape.
He also should consider insuring his dog and Mrs. Claus’ cat, says Stacy Kowalchuk, social media manager at pet health insurance company Trupanion.
“You never know if one of them might sneak some of Santa’s cookies and get gastrointestinal upset, or experience a broken leg hopping from house to house,” Kowalchuk says. “Pet insurance helps protect against those expensive veterinary bills that may arise from an unexpected accident or illness.”
10. Cargo insurance.
When delivering presents, Santa carries billions of dollars worth of goods in his sleigh. What if he hits turbulence and the presents fall out? What if a band of flying pirates loots his sleigh? Santa should protect his gifts by purchasing a cargo insurance policy, O’Brien says.
11. Travel insurance.
Given Santa’s extensive international traveling schedule, he should purchase travel insurance before starting his trip around the world. This coverage will pay for overseas medical care, or even cover the cost to evacuate him to a medical center or safe haven, says Suzanne Garber, chief operating officer for the Americas region of travel insurer International SOS. Sadly, this coverage even would pay to send his remains home to the North Pole if he meets his end while traveling.
Gina Roberts-Grey
The tree is trimmed, the stockings have been hung with care and the gifts are piling up under the tree. Yet it wouldn’t take long for Christmastime crooks to put a damper on all of your holiday cheer.
So, what happens if a thief makes off with the Christmas gifts or steals the shopping bags from your car? By and large, your home or renter’s insurance will help you feel less like a sullen Charlie Brown if you’re the victim of a Christmastime crime.
Insurance experts say gifts or other holiday goodies stolen from your residence generally would be covered by your home or renter’s insurance. Holiday purchases swiped from your car would not be covered by your auto insurance but instead by your home or renter’s insurance, as they’re considered personal property and aren’t permanent parts of your car.
 |
| Home or renter’s insurance normally will cover your losses if your house becomes a Christmas crime scene. |
A nationwide survey by the Independent Insurance Agents & Brokers of America found that 44 percent of the people questioned, or more than 100 million Americans, have been victims of burglary, robbery or another form of theft. Of those who were victims, only 40 percent said their stolen property was insured.
Eustace Greaves Jr., owner of Greaves Financial Services/The Bridge Insurance Agency in Brooklyn, N.Y., says that if you a file an insurance claim for gifts taken from your home or car, you’d have to first pay your deductible.
“The most common homeowner’s deductible is $ 1,000,” Greaves says, “so you would have to have stored presents with significant value before you’d even want to turn in a claim.”
There’s another reason to carefully consider filing a claim related to a Christmas crime.
Aaron Sorenson, an independent insurance broker at Insurance Brokers of Minnesota, says that claim could come with a nasty gift you didn’t ask for and can’t return: higher insurance premiums. Filing a claim like that may boost your insurance premium by an average of 10 percent to 15 percent, Sorenson warns.
In case you do need to file a claim for stolen gifts, be sure to hang onto the receipts for those purchases.
A present being plucked from your home or car trunk isn’t the only type of holiday crime that could result in an insurance claim. Here are three others.
1. Vandals or thieves un-deck your halls.
Outdoor holiday decorations — like inflatable reindeer and Nativity scenes — sometimes are playthings for petty thieves or mischievous teens. When Michael Nowak was a cop in Los Angeles, calls around the holidays about broken and stolen outdoor decorations “were always very common,” he says.
Greaves says a home insurance claim for this type of damage or theft would be covered, but you’d have to pay your deductible first. And if you do file a claim, those nasty elves could cause financial heartache for years to come. Any claim not related to weather can trigger a 10 percent to 15 percent hike in your insurance rates, Sorenson says.
2. A porch pirate makes off with your loot.
Three years ago, Lindsay Anderson of New York City couldn’t make it home for Christmas, so her mom shipped her two big boxes stuffed with gifts. But Anderson never opened any of those gifts. Why? The boxes — filled with things like kitchen utensils and pots — apparently were stolen by “porch pirates,” even though the shipping company had a record of someone with her name signing for them.
Anderson scoured the neighborhood for the wayward boxes, but they never turned up. Because the packages weren’t insured for the full value of the contents — about $ 1,000 — Anderson wound up collecting only about $ 200 from the shipping company.
Sorenson says home or renter’s insurance may have paid this type of claim. If gifts sent via the U.S. Postal Service, FedEx, UPS or other shippers are stolen after being left at a home, your home or renter’s insurance can help pay for the loss — minus any deductible.
“Of course, taking out insurance (from the shipper) for the full amount of the items you’re sending during the holidays is something to consider,” Greaves says. “That can spare the gift giver and recipient a lot of heartache.”
3. Your jewelry is snatched.
Let’s say a holiday visitor in your home slips your favorite ring and a few of your bracelets into his pocket. The loss would be covered by your home or renter’s insurance — depending on how much the stolen goods are worth. You’d still be on the hook for the deductible.
Keep in mind that high-value items like a massive diamond ring may not be covered under a standard home or renter’s insurance policy.
If you have a high-value piece of jewelry, an inland marine policy may be a better option to insure it than your standard home insurance policy, according to Howard E. Candage, an insurance agent in Portland, Maine.
Inland marine policies — which actually have nothing to do with water — cover a host of insurance claims that the average home insurance policy might not. They also provide coverage based an item’s agreed value. So if an inland policy states a ring is worth $ 9,000, that’s what you would receive after any applicable deductibles.
Under typical home insurance coverage, a $ 9,000 ring might be covered only for its replacement value, or the amount it would cost to buy a new one at current market prices. This means you might get only $ 6,000 for a ring based on its current market value, even though you think it’s worth $ 9,000.
Christmastime fraud
By the way, insurance experts say the holiday season delivers an increase in fraud-related claims, including ones involving “missing” jewelry. That’s presumably because some people are desperate for holiday cash to spend on gifts.
Greaves warns that this type of fraud is fairly easy to detect, as all home and renter’s insurance claims are logged into the Comprehensive Loss Underwriting Exchange (CLUE) database. Among other things, the CLUE database contains information about dates, types and amounts of insured losses that a policyholder has incurred. Greaves says the database is checked whenever someone applies for home or renter’s insurance.
Tags: 