Santa Claus Forms Captive, Appoints CIC Services, LLC As Captive Manager
North Pole, December 22, 2014
Santa Claus, Inc. announced the formation of its first captive insurance company, Sleigh Bell Insurance, Inc. The move comes as the toy delivery operation has determined a need to overhaul its approach to risk management with the goal of protecting the enterprise well into the future. Owner and CEO, St. Nicholas noted that “we used to just be a mom and pop operation with elves making simple toys and all deliveries by sleigh… but like many small businesses, our operation has grown and become far more complex, necessitating a grown-up approach to our risk management.” St. Nick made it exceedingly clear that, “We can’t let unexpected events shut down our operation… millions of children are counting on us!”
Sleigh Bell Insurance, Inc. will insure operational and strategic risks. When discussing operational risks, St. Nicholas pointed out that, “Surgeons insure their hands, athletes have enormous disability policies, singers insure their voices, I even heard that Gene Simmons insured his tongue…anyway, I haven’t been able to find an insurer that will cover Rudolph’s nose… in fact, none of them will return my phone calls.”
Other operational risks insured include property & casualty deductibles, administrative actions insurance, business interruption insurance, supply chain insurance, terrorism and cyber insurance. The Federal Aviation Administration and Homeland Security almost shut Santa Claus, Inc. completely down after 9-11. St. Nick pointed out that a captive would have made it far easier to pay for the interventions necessary to sustain operations in a post 9-11 world.
Supply chain insurance has become particularly important with the advent of digital toys, games and devices. St. Nick lamented that, “the Elves just can’t make a lot of the toys and gadgets children wish for these days… we now have an extensive supply chain operation to source digital devices.”
Cyber insurance has often been maligned by “old guard” types in the captive industry. When questioned about his large cyber insurance policy, St. Nick bristled and became red-faced. “Are you kidding me…did you see what a tin pot dictator in North Korea just did to Sony?” Santa retorted. “Crazies like him would like nothing more than to shut our operation down… the last thing Kim Jung Un wants is smiling, happy children around the globe…this is why our terrorism insurance is so critical, too…they would love to shut down Santa Claus, Inc., and they have tried many times in the past.”
As previously noted, Sleigh Bell, Inc. also insures strategic risks. “Reputational damage is a big one for us,” St. Nick pointed out. “Every few years, an imposter at some mall does something offensive or shows up drunk.” Santa Claus, Inc. has spent millions of dollars over the past centuries combatting negative press, when embarrassing incidents occur. “Ever since the invention of the printing press and wide-spread news reporting, reputational risk has been a reality for us… from now on, we are filing losses through our captive.”
In our continued conversation on strategic risks facing his operation, St. Nicholas noted, “another strategic risk that really scares me is global warming…our captive allows us to write a policy for it to cover the cost to move the entire operation to the South Pole…I’m not sure I believe in global warming, but a lot of scientists and Al Gore do; if it’s real…it would be curtains for Santa Claus, Inc.”
St. Nicholas and Mrs. Claus chose CIC Services, LLC as their captive manager because CIC Services is the premier firm serving small and mid-size businesses. He noted that, “the principals and staff at CIC Services, LLC truly are small business champions… they are creative in their approach to risk management and helped us improve our risk management and long term financial position as well.” Mrs.Claus suggested that she is more detail oriented the Mr. Claus. She did her own extensive research and came to the same conclusion. According to Mrs. Claus, “I did extensive research and read about The CIC Services Difference… it was clear to me that they were far and away the best choice as a captive manager.”
Saint Nick concluded our interview by saying,
We were slow to pursue owning a captive because we encountered confusing information on the internet. CIC Services, LLC helped us fully understand captives and move forward with confidence. Now, we have a far more powerful risk management plan, more wealth and a lot more peace of mind. When I wrote my premium checks to my captive this year, I said to myself, “HO! HO! HO!”