Broken light fixtures, dented drywall, syrup-coated appliances—these are classic examples of holiday magic gone wrong. With the season in full swing, more and more homeowners are waking up each morning to a new dose of destruction brought by a well-intentioned but sometimes overzealous houseguest: the Elf on the Shelf.
What began in 2005 as a client reconnaissance operation for Santa Claus—elves sent from the North Pole to monitor children’s behavior for Naughty or Nice List consideration—is now wreaking havoc on an increasing number of households around the globe. Santa employed more than 11 million scout elves as of 2017, and experts say the current elf workforce could easily be double that figure, with independent entrepreneur elves and a new wave of elf babies joining the ranks.
No longer content to sit idly on a bookshelf or mantle, today’s average Elf on the Shelf is engaged in moderate to severe mischief-making after midnight. According to reports, elves have dismantled furniture, defaced countertops with permanent marker, rummaged through personal files and exposed home office networks to hackers.
Many individuals cannot afford these elf-related expenses during an already budget-breaking time of year. The average American family spent $885 on holiday gifts in 2018 and holiday spending has already broken records this year, with overall online sales of $72.1 billion since November 1.
Despite growing unease among parents, ridding a household of its assigned elf is a near impossibility due to the notoriously strong connection forged between shelf elves and the children they observe. With that in mind, experts are urging elves and their hosts to obtain insurance coverage to help protect their assets against potential elf mischief-related losses. Consider the following areas of top concern.
1. Property damage – when magic gets messy
Property damage inflicted by an Elf on the Shelf can lead to significant replacement and repair expenses, emphasizing the need for adequate Homeowners Insurance coverage. Although typically characterized by elves as accidental, incidents of elf misconduct are often defined as acts of vandalism and the associated expenses can be covered under a Homeowners Insurance policy.
Elves are notoriously drawn to shiny objects and prized possessions, so any big-ticket items in the home should be covered by a Personal Articles Floater policy.
Elf mischief often involves play with kitchen utensils and appliances, which can pose serious fire hazards. In fact, in one highly publicized case, an elf caught fire in an oven—though parental forgetfulness was the cause rather than elf mischief. Additionally, water backups and flooding have been reported by parents who found elves tampering with faucets and flushing pillowcases.
Elf-related property concerns affect homeowners, those who have a home under construction, and renters. In Canada, where rental housing growth is outpacing home ownership, renters insurance is an important consideration. The same goes for American households, 36 percent of which are renter-occupied. Condominium owners, who could be held liable if their elf damage affects their neighbors, should ask their insurance brokers or agents if they have the appropriate Condominium Unit Coverage.
2. Elven prank-related injuries
The holiday season is a time of frequent gatherings with family and friends, who are tempting targets for an Elf on the Shelf fond of pranks and the riskiest forms of mischief. Some of the most common elven pranks involve spilled hot cocoa, syrup on shoe soles and blanketing hardwood floors with glitter. Falls resulting from such pranks can lead to injuries, especially for older adults, with 3 million older people treated in U.S. emergency departments for fall injuries each year.
Elves who engage in extreme pranking on commercial property should prompt business owners to consult their brokers or agents about investing in Commercial General Liability Insurance and Excess Liability Coverage. Even unsuspecting mail carriers or home contractors could be subject to an injury caused by elf mischief. While coverage for injury-related expenses at home can often be included in a Homeowners Insurance policy.
With Elf on the Shelf-related incidents evolving each year, homeowners would be well served to discuss with their insurance brokers or agents the potential exposures and liabilities that can come with hosting one of these magical creatures. While some elves will never cause a problem, the desire to become the next viral sensation has driven many otherwise conscientious elves to engage in increasingly extreme mischief-making.
More and more elves and homeowners are finding that investing in Personal Umbrella Insurance to cover property damage and liability expenses above and beyond the coverages included in their existing policies is a necessity to fully protect themselves and their assets.
3. Cyber safeguards for home offices
One of the most pressing concerns among those who conduct not only personal but professional business using their home Wi-Fi network is how Elf on the Shelf mischief may expose that network to hackers. Elves have unprecedented access to correspondence, banking and credit account information, invoices, medical records and any other data readily available using equipment in hosts’ homes and home offices.
Elves are inordinately fond of sharing photos and videos of themselves on social media and ordering equipment to order trade-specific tools and clothing from online retailers, all activities that leave networks vulnerable to cybersecurity risks, especially when the same email address and passwords are being used across multiple sites.
Cybersecurity experts advise any individual who lives with an Elf on the Shelf—especially those who work or conduct business from home—to make cybersecurity a top priority. Cyber and Privacy Liability Insurance can help shore up cyber protections and cover costs of recovering from a network breach, including ransom, business interruption, public relations and privacy violations.
4. Considerations for elven entrepreneurs
Today’s status-conscious elf culture may be partially to blame for the escalating mischief-making being reported in homes. As elves work to outdo their colleagues with the most outlandish and creative tableaus, some enterprising elves have taken their mischief to new heights by interfering with construction projects.
Investing in Commercial General Liability, Professional Liability and Architects & Engineers Errors and Omissions Insurance policy coverage is vital. Such coverage can help businesses stay afloat in the wake of the substantial expenses they might incur when things go wrong, from design flaws to equipment failures, to worker accidents and errors at the hands of an unskilled elf.
In response to the growing complexity of Elf on the Shelf activities, Santa and his North Pole associates have compiled a comprehensive employee handbook outlining clear standards and practices regarding shelf elf behavior and responsibilities.
Given the range of exposures they face as employers of mischief-making elves in various sectors, Claus and company should consult their insurance brokers and agents to evaluate whether they have the appropriate Employment Practices Liability Insurance (EPLI) and Directors & Officers Liability Insurance (D&O) policies in place, should Santa make an unlikely yet costly error in judgement or his employees’ mischief-making take a turn toward decidedly less magical realm of legal liability.
Products Liability and Manufacturers Errors and Omissions Insurance (E&O) should also be a consideration for Santa and entrepreneurial elves engaged in crafting anything from shelf elf homes and hideouts to toys to elf tableaus. Investing in such coverage will help them stay afloat as they manage the fallout from a product failure and field calls from disgruntled elves and human toddlers alike.
This information was provided by Burns & Wilcox, North America’s leading wholesale insurance broker and underwriting manager. Ask your insurance broker or agent to review any of your personal or business policies to ensure you have proper protection, elf-related or otherwise.