A penny saved is a penny not available to protect a player’s future.

Well, ain’t this a real kick in the pants.

Tua Tagovailoa’s season-ending hip injury may have cost him upwards of $10 million. Why? Unlike other high-profile NFL prospects, the insurance provided to him by the University of Alabama did not include a loss-of-value policy.

That means he will not be able to recoup millions of dollars in potential losses if he falls from the possible No. 1 overall pick in the 2020 NFL draft to, say, the mid-first round, which some prognosticators are expecting.

Tagovailoa, sources said, decided to only take the coverage that Alabama gave to him. Tua’s coverage entitles him to collect if doctors rule he can never play again, as the school purchased permanent total disability insurance for the QB.

And why doesn’t ‘Bama, with all its soon-to-be pro studs on the roster, fork out for the coverage?

Sources said Alabama has not, in recent memory, agreed to pay for loss of value for any of its players due to the policy’s cost compared to the percentage of players who actually collect.

Alabama athletic director Greg Byrne told The Action Network the school currently has 16 football players for which it pays permanent total disability premiums.

The money Alabama spends on those premiums took up 68% of the school’s allocation of its Student Assistance Fund this year. (The NCAA stipulates that the only way schools can pay for insurance premiums for players is through this fund, which is a pool of hundreds of millions of dollars that is split among institutions.)

Schools have to always leave some money available in their fund to pay for approved use of giving student athletes benefits in case of emergencies (death in the family, natural disaster, etc).

“In consultation with industry experts, loss of value has not been shown to consistently benefit student-athletes who file a claim,” Byrne said. “If you have loss of value, you still have the opportunity to have a successful professional career. One of the reasons we go with permanent total disability is to protect the student-athletes should they not be able to play again, in which case they have no ability to make any future earnings through their sport professionally. In the event of injury, we utilize our resources through health care and rehab to help them increase their draft value.”

Very prudent.

The point here isn’t to throw shade at Alabama.  Byrne is doing the best he can under the rules, which are set by every player’s friend, the NCAA.  But this is what you get when a school is loaded with pro prospects; the system simply isn’t set up to accommodate a situation like that, basically because schools in general don’t want the expense.

Which sucks for Tua.  And, yes, the family could have bought coverage on their own, assuming they could afford it.  That’s a pretty steep bill, though, and if they couldn’t swing it, it’s not like they could have asked a friend (or an agent) to front it for them without getting into a different issue with the NCAA.

I will say that this could make for an interesting sales pitch on the recruiting trail, though.

(h/t)

12 Comments

Filed under Alabama, It's Just Bidness, The NCAA

12 responses to “A penny saved is a penny not available to protect a player’s future.

  1. siskey

    Are there any people here with experience in insurance that can speculate as to how much the type of insurance Tua has through Alabama costs and how much the type he does not have would cost? Seems like there could be another pool of money to provide for the players that would cover this for everyone. Also, how do they determine the latter value that the player would potentially lose out on? Seems like there would be a lot of wiggle room as it relates to the value a player lost considering the mostly speculative nature of the NFL draft and the duration of NFL careers.

    Like

  2. Hogbody Spradlin

    I agree that Alabama did the best it can with its insurance budget. The loss of value makes a nice big dollar amount if Tua misses out on that top draft pick bonus. But being able to insure more players is a sound decision.

    Like

  3. Too bad the college degree isn’t worth enough to provide a decent backup plan by itself.

    Like

    • Got Cowdog

      Huh. working up from 40 to 85k a year as a high school coach in 10 years, with a nice middle class retirement after 30 years. Opposed to 20 million or so for 5 years in the NFL? That’s a backup plan, man.
      Too bad Tua couldn’t make a few grand off ads, picture sales, or jersey sales with his number on them. Might be he could have droppe some money on that insurance policy himself…

      Like

  4. Macallanlover

    Seems like any number of banks in Alabama would make a loan to the family given the certainty of the family to repay in the near future. They should have pursued, imo. Bama has to consider the whole team in how they use their money. Had never thought about the number of players they have to fund, and how they were limited. Big mistake, Tua already had red flags about being susceptible to injury according to some NFL scouts in a report I heard last week. Shame, seems like a great kid with a great family support.

    Like

  5. Uglydawg

    Agree with Mac about borrowing the money. They should have the credit to buy anything they want…and esp. injury insurance.
    But what about kids that are only marginal NFL prospects? No credit.
    That’s a different cup of tea.
    Tua is a great kid.
    I really hope and pray he has a complete recovery and gets paid a heap of money in the NFL.

    Like

  6. Uglydawg

    This is a short and heartbreaking story about Marcus Lattimore and his inability to overcome his devastating knee injury. He was eligible for a five million dollar insurance policy at South Carolina. He didn’t have it. He signed with SF of the NFL but never played a snap. Today he’s employed by the University of SC.
    https://www.businessinsider.com/marcus-lattimore-retires-nfl-2014-11

    Like

  7. jhorne2000

    Surely there are lenders out there for guys like Tua.

    Like

  8. W Cobb Dawg

    Wasn’t there a commenter on a recent post (similar to this), who said those insurance policies are essentially useless because the insurer fights tooth & nail rather than pay out? Draft projections are all over the place. Some of the GOATs were drafted late, like Brady, or not at all. How is an insurer supposed to accurately determine a given player’s future draft position? Listen to Mel Kiper?!

    Sure, some form of injury insurance is legit. But speculating that Tua would be worth multi-millions seems more like a stunt – like insuring Angie Dickinson’s legs. The cost of a “real” policy would be astronomical, particularly for a high risk QB in a high risk sport like football.

    Like

    • ASEF

      All good points. I know for awhile (maybe still), you had to use London-based insurers for this stuff, couldn’t even get it in the US.

      Like

  9. FlyingPeakDawg

    Not an expert, just generally aware of how specialty policies like this may work. The market is relatively small and exclusive. Since insurance is a shared risk pool, the premiums are likely going going to be tens of thousands of dollars to cover losses in the millions. Covering $150,000 of annual income for a young physician in their 30’s can be $3500 / year so scale that up for something more high risk like this and you get an idea. Lloyd’s of London specializes in underwriting these types of policies. Banks are unlikely to loan based on potential income…they’ll demand real collateral to be posted. And before anyone throws stones at the family for not purchasing coverage, please disclose how much individual non-employer paid disability income you own on yourself. Statistics tell me you are likely very underinsured vs your potential lifetime earnings. But…operators are standing by!

    Liked by 1 person

  10. Mayor

    I’ve represented clients who suffered the same injury as Tua—a fracture dislocation of the acetabulum. Tua’s done. He’s not playing football any more. Period.

    Like