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A Business Insurance Case against Ebenezer Scrooge

18. December 2015 07:50

Scrooge counting coins

Everyone is familiar with Ebenezer Scrooge, the grumpy old miser at the center of Charles Dickens's A Christmas Carol. The curmudgeonly crank is famous for his penny-pinching ways and animosity for the rest of mankind. Doesn't exactly sound like the most pleasant small-business owner, huh?

In addition to being a terrible boss, Scrooge was running his business in a witless way from a risk management perspective. Let's visit some of Scrooge's biggest blunders and examine how they exposed his business to risk.

1. Baby, It's Cold Inside

Winter winds bring plummeting temperatures, especially in Victorian England. Scrooge "iced his office in the dog-days; and didn't thaw it one degree at Christmas."

Cold conditions increase your chances of getting sick and spreading germs. According to a New Scientist article, flu strains spread best in cold, dry weather. Yuck. By keeping his counting house continually cold, Scrooge faced an increased potential for sick workers and lost profits.

In a modern office, frigid temperatures could present problems with pipes bursting. That would bring production to a freeze. Too bad modern Scrooge may be too stingy to invest in Commercial Property Insurance, the only policy that can help with those repair costs.

2. I'll Be Home for Christmas (or Not)

Scrooge didn't believe in giving much time off to his employees – only one day of the year. He declared Christmas a "poor excuse for picking a man's pocket every twenty-fifth of December."

Constant work is bad for overall morale and productivity. According to "An Assessment of Paid Time Off in the US [PDF]," a study from Project: Time Off, businesses that offer time off earn back "dedicated, productive, satisfied, and healthy employees." It's all about achieving a work-life balance – something Scrooge knew nothing about.

See "5 Ways to Maintain Small-Business Productivity During the Holidays" for more ways to keep employees motivated.

3. All I Want for Christmas Is Some Natural Light

In Scrooge's icy cold counting house, his clerk Bob Cratchit sat "in a dismal little cell, a sort of tank."

Sounds like conditions ripe for Workers' Comp claims. Tight, repetitive work in cramped quarters can lead to carpal tunnel syndrome and lousy lighting can cause eyestrain. Scrooge would be an unlikely candidate to carry Workers' Compensation Insurance, which helps pay for an employee's medical costs or lost wages when they're hurt at work.

Most modern businesses are required to carry Workers' Comp (check your state's WC laws) once they hire their first employee – unless they want to risk lawsuits, fines, and possibly jail time. Read "What Not to Do: Workers' Compensation Edition" for workplace safety don'ts.

4. Chestnuts (and Everything Else) Roasting on an Open Fire

While "no warmth could warm, no wintry weather chill him," Scrooge did keep "a very small fire" – one for himself and an even smaller one for his clerk.

Keeping a stove or two burning coal in your office certainly presents a fire hazard. Not to mention doing work by candlelight. Open flames are always risky. One stray ember and the whole counting house – and Scrooge's entire business – could go up in flames. Without business insurance, Scrooge would be over a barrel.

Learn more in "Fire Damage at Chicago's Second City Illustrates Benefits of Insurance."

5. It's the Most Profitable Time of the Year

It would be an understatement to call Scrooge a frugal individual. He was "a tight-fisted hand at the grindstone," figuring how to keep every bit of coin. His clerk Bob Cratchit made only "fifteen shillings a week." Scrooge turns away the warmth his nephew Fred exudes and he scoffs at giving charitable donations. Bah, humbug!

Scrooge is concerned with his bottom line – and little else.

Studies, like the one detailed in this article from online business magazine Fast Company, have shown that employees who have a sense of purpose at work beyond profits are likely to stay longer and be more engaged. And better performance means less risk of making work-related errors (something E&O Insurance can address).

In the end, Scrooge transformed from grouch to generous giver after his visits from three ghosts. He could probably also benefit from reading our post "How to Show Holiday Love to Employees & Clients – On a Budget" for a few tips on spreading festivus cheer to people that make his business successful.


Errors and Omissions Insurance | General | Property Insurance | Risk Management | Small Business | Small Business Risk Management | Workers' Compensation Insurance

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