Lloyd's of London, not Starbuck's, is almost certainly history's most important coffee house, and the Lloyd's markets are justifiably famous for their ability to place insurance coverage for unusual risks, as exemplified by this list of 9 Odd Things Insured by Lloyd's of London. (Look! Elephants!)
Like a bespoke suit, a "bespoke policy" of Lloyd's insurance is a sign that a certain height of celebrity has been achieved by its holder. The latest example is Lloyd's providing insurance for a winemaker's nose and sense of smell for €5 million ($7.8 million). The insured is Ilja Gort, the Dutch owner of Chateau de la Garde in Bordeaux, and his is hardly the first olfactory instrument so insured. Per the Lloyd's press release:
[N]ose insurance is not just restricted to wine buffs. It is a common purchase for a range of occupations, and Watkins Syndicates is currently working on a policy with a US perfume consultant who develops new fragrances for perfume houses.
[Underwriter Jonathan] Thomas explains: 'You have a limited number of people who need to insure their nose to [Gort’s] extent. But few people realise just how important their nose is to their job. Look at the wine, perfume and food trades – a loss of sense of smell has a huge effect on their roles.
'The most famous nose to insure was that belonging to [sherry maker] Jose Ignacios Domecq. Not only did he have a very distinct sense of smell for sherry, he also had a very distinct nose. Mr Gort is following in a fine tradition.'
In fact Domecq was known as El Nariz, ‘the Nose’. He earned this name for literal as well as figurative reasons – his hawk-like nose was memorably large.
[Mr. Thomas needs to brush up on his American entertainers, however: he refers to proboscally-unchallenged Lloyd's-insured singer-comedian Jimmy Durante as "Snozzle Durantee." No respect for the classics, these underwriters.]
As noted by Patrick Collinson of The Guardian, "The more eccentric policies - on celebrity posteriors, fingers and noses - are . . . virtually all publicity stunts."
Celebrity-related coverages can, however, serve a genuine function to protect those who are dependent for their livelihood on the continuing well-being of a prominent person. In cases of that sort, Lloyd's celebrity policies qualify as one of the more specialized forms of "key man" insurance. "Tiger Woods’ caddy, . . . has a policy to protect against his master’s early death," and Las Vegas magicians Siegfried & Roy, who carried Lloyd's policies on one another, actually collected when Roy was badly mauled onstage by one of the team's white tigers.
One has to be sure, with policies like these, that the beneficiary has an actual insurable interest and will suffer a genuine loss should anything untoward happen to the insured party. Otherwise, there are certain negative externalities created, as Collinson observes:
[T]he Victorians had a nice line in gambling on unconnected people's deaths until it was outlawed in the early 1900s. It produced rather too many incentives to bump people off.
~~~
Illustration: The prominent sniffer above is neither Domecq's nor Durante's, but is the official mascot of the annual (and highly recommended) International Pinot Noir Celebration, in McMinnville, Oregon.
