behavior, pre-existing conditions or injuries sustained while taking unnecessary risks. As discussed in Re-Adjusted:
20 Essential Rules To Take Your Claims
Organization from Ordinary to Extraordinary, carriers will have to do significant due diligence to ascertain both the
causation of the injury, as well as identifying any mitigating factors that could
potentially limit exposure under a loss of
In the case of Marquise Lee, his policy
limit is up to $5 million. This is in excess
of the NCAA disability policy, which is
also $5 million. The caveat here is that
the NCAA policy won’t pay because it requires a complete disability and does not
provide coverage for loss of value.
Another challenge facing players is not
only the type of policy to purchase, but
how the policy will be paid for. While the
NCAA does allow players to purchase
these types of policies, they don’t allow
players to consult with agents who actually have expertise in the world of professional sports finances. This creates a
massive headache for twenty-somethings
who probably can’t make heads or tails of
what they are signing.
Another area of potential contention is
provability. Is there evidence that shows
a player lost value in the draft because of
the injury or are there other intervening
causes? Consider the many off-field issues that plague some players. Would that
have an impact in the value of potential
claims? In the event of both an off-field
incident and an on-field injury, how did
each impact the player’s draft position?
Calculating this loss can be somewhat
challenging as well. As far as simply playing football, there are fairly straightforward formulas as to what players will receive. The higher in the draft, the higher
the compensation. If a player falls from
10th to 50th, they have fallen 40 slots and
there is a mathematical equation that can
calculate that loss.
But, what about outside compensation,
such as endorsements? A top 10 player
might get a very lucrative endorsement,
which is unlikely for a player drafted 50th.
This is likely going to be a challenge un-
less the value is specified in the contract.
But, it is very difficult to create a policy
that covers something so speculative.
Let’s take a look at how this will play
out for Myles Jack, who is covered with a
$5 million dollar loss of value policy. Ac-
cording to ESPN, a source familiar with
his policy indicated that he would collect
if he fell to the 45th pick in the draft and
would get approximately $60,000 per
pick after that. To collect on his entire
policy, he would have to have fallen into
the sixth round. Jack was selected as the
36th pick in the draft and therefore won’t
As for Jaylon Smith, the other de-
fender that slipped in this year’s draft, he
will fare a bit better. According to NBC
Sports, Smith will receive about $900,000,
as his policy kicked in if the player fell out
of the first round. He was selected in the
second round as the 34th pick. However,
he is still out a substantial sum of money.
Had he been selected as the third pick,
where many draft boards placed him, he
would have gotten a contract with a value
of $26 million dollars. As the 34th pick,
he will get about $6.5 million dollars.
The good news is that there is such
coverage available to protect players
from career-limiting injuries. The bad
news is that these policies vary widely
in terms of coverage and exclusions. As
is the case with any insurance policy, it
is important to understand what you are
purchasing as well as taking the time to
read the fine print.
Chris Tidball is a casualty solutions consultant
with Mitchell International and the author
of several insurance based books including
Re-Adjusted, Blocking & Tackling and the
recently released thriller Swoop & Squat.
To learn more visit www.christidball.com.