The Night Before Christmas – 2001 Version

December 25, 2001

‘Twas the night before Christmas and all over Europe a scrambling of F-16’s could be heard, as an unidentified flying object hurtled at astounding speeds through the night skies. First spotted over Russia and eventually localized above the English Channel, a group of NATO fighters finally succeeded in forcing the suspect craft to land.

At an air base north of London, Officers from the Royal Air Force and several representatives of NATO braced themselves for a confrontation with “a suspected terrorist strike force.” What they saw astounded them. A bearded, corpulent man in a garish red suit, who identified himself as Mr. Nicholas Claus, descended from a flying contraption that on closer inspection proved to be an old fashioned sleigh. Its only motive power appeared to be a number of large deer, one with a bright red nose, who were subsequently identified as “reindeer, probably from Finland.” Their origin alone, bordering the ex-Soviet Union, increased suspicions.

Mr. Claus was placed under preliminary detention, despite his vehement protests that his schedule for delivering presents to the world’s children simply could not be interrupted. An alert British officer finally identified him as a persistent folkloric myth, commonly known as “Santa Claus,” and, as a thorough search of the sleigh failed to turn up anything more threatening than some cap guns and water pistols, he was probably harmless.

As there seemed to be no reason to further detain the elderly gentleman, the authorities prepared to release him, but the proceedings were interrupted by the appearance of several large men in trench coats and dark glasses (despite the fact that it was after midnight), who explained that they had been dispatched by the Central Intelligence Agency to investigate this latest sinister occurrence for possible links with terrorist organizations.

Claus explained that he’s been delivering presents since long before anybody even heard of the U.S. or the CIA and demanded to be allowed to continue his rounds unmolested. The authorities, which now numbered quite a crowd, agreed that it would in fact be an appropriate humanitarian gesture to allow Claus to go on his way, but one of the CIA men insisted on knowing where he was headed. Upon learning that his next destination was the U.S., the man demanded to know whether he had adequate insurance coverage.

Claus exploded. He explained that he’d never had this kind of problem before, and “besides, I’m an excellent risk,” said Claus, “me an’ my reindeer haven’t had a loss event in the last 1000 years or so.” The man replied that things have changed since Sept. 11, and that everyone needed to be aware of that. If Claus didn’t have insurance, particularly coverage for terrorist risks, he couldn’t enter U.S. airspace.

“Why would I need that?” asked a somewhat bewildered Claus, but the operative continued to insist that without terrorist cover he couldn’t continue his voyage. All seemed lost, but even the C.A. didn’t want to be responsible for preventing Santa Claus from fulfilling his Christmas Mission. Still, “rules is rules.” If Clause left for the U.S. without terrorist cover, he risked being shot down. Someone in the room recognized that the situation maybe wasn’t entirely hopeless. Coverage might be available.

A call to Lloyd’s showed some interest, but then the question of reinsurance was brought up, and there didn’t seem to be a single syndicate left with enough capacity to accept such a strange risk, unless it could be adequately reinsured. Things looked bleak indeed, when a call came from one of Lloyd’s newest syndicates, Ascot 1414, backed by AIG. The underwriter confirmed that he’d called Hank Greenberg, and told him about the problem. “Cover it,” said Greenberg.

Thus Mr. Nicholas “Santa” Claus was released to resume his deliveries, and the children of the United States got their Christmas gifts on schedule.

Subsequent reports indicate, however, that the world may expect some changes. In return for the rather substantial premium payment, Claus turned over his sleigh to AIG, and then leased it back through ILFC, the company’s airplane leasing subsidiary. AIG now reportedly controls 51% of N. Claus North Pole Industries Inc., Santa’s holding company, and has announced that it will relocate its headquarters to Bermuda. There are also reports of labor unrest among Santa’s elves as the new management also announced several cost savings initiatives, including moving production facilities to China. The elves have threatened industrial action, and have demanded import restrictions on Chinese toys; they’ve also recently formed a union and are demanding workers’ compensation insurance, health benefits and a pension plan.

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