NHL Insurance Plan Covers Player Contracts For Seven Years

NHL Insurance Plan Covers Player Contracts For Seven Years

Published September 11, 2008

The NHL's insurance plan insures player contracts for seven years, and "beyond that, if the player gets hurt, the team is on the hook for the full amount of his contract," according to Luke DeCock of the Raleigh NEWS & OBSERVER. As part of the plan, which the NHL purchases through New York-based insurance broker BWD Group, NHL teams are "required to insure a handful of players through a 'temporary total disability' program administered by the league." Each team "pays a premium based on the salaries of its five highest-paid players, but is free to allocate that coverage how it wishes." NHL Deputy Commissioner Bill Daly said that "typically, a team will extend coverage to as many as seven players." Insurance coverage "kicks in when a player misses at least 30 games," and insuring a player under the league program "costs about 5[%] of his salary." But Hurricanes GM Jim Rutherford said, "When you get to a certain dollar amount, the premiums keep skyrocketing. I wish it was easier to get each (player) insured, but we can't do that." DeCock noted individual teams "are free to pursue additional coverage, but the heavy premiums make it a losing proposition." Rutherford said that "seeking private insurance to cover a longer deal is prohibitively expensive." The Hurricanes this season "will pay almost $1[M] for $19[M] of coverage through the league program, but even that process isn't simple," as insurers "may balk at something as specific as an individual body part." Rutherford said that the Hurricanes "were able to insure [RW] Justin Williams last season despite a previous injury to his right knee." Williams missed more than three months with a knee injury and the team received insurance payments, but they "wouldn't be able to insure that knee again this season" (Raleigh NEWS & OBSERVER, 9/10).