Ten Million in Cover, Two Known Payouts: Inside College Football's Insurance Market
Published on August 10th, 2026Written By: Dave Manuel
Somewhere in the next three weeks, in an office at a power-conference football programme, a twenty-one-year-old will sign a document he does not fully understand, insuring his own knee for several million dollars against the possibility that it stops working before he can sell it. The FBS season opens on August 29, and the fortnight before a final college season is when these policies get written. There are two of them, they do completely different things, and the governing body that offers the first one publicly refuses to offer the second - telling its own athletes, in writing, that the coverage has not been shown to consistently benefit the people who claim on it. What follows is the whole market laid out as the claims file it really is: what the policies cover, what they cost, who pays, every payout anybody has ever confirmed, and the one that was refused after a premium of $94,600.
Sports-King Feature
The Insurance File
Ten million dollars of cover, a handful of confirmed payouts, and a governing body that will not sell you the policy everyone talks about. Inside the market that insures a college football player's final season.
Master FileSEASON OPENS AUG 29
College Football InsurancePRODUCTS .... DISABILITY, AND LOSS OF VALUETOP COVER ... ABOUT $10M PLUS A $5M RIDER
PREMIUM ..... ROUGHLY $8,000 PER $1M INSURED
CONFIRMED PAYOUTS A LIST THAT FITS ON ONE PAGEOPENEleven entries, each written up the way an insurer would file it.
Top-End Cover Available$15M
Largest Confirmed Payout$3M
Estimated Total Ever Paid$8M
Premium That Bought Nothing$94.6K
Insurance is the least glamorous subject in college football and quietly one of the most revealing. A player with a first-round grade is carrying an asset worth more than most of the businesses in the town his university sits in, and he is required to risk it, unpaid by the professional league that will eventually buy it, for one more season. The insurance market that grew up around that problem is small, strange, largely written by Lloyd's of London, and much harder to collect from than the sales pitch suggests. It is also the direct alternative to the thing everybody argues about every December, which is a star player skipping a bowl game. Every entry below is a form in the same file.
01
POLICY TYPESFORM A-1
PTD and LOVPTD ......... CAREER-ENDING INJURY OR ILLNESSOFFERED BY .. THE NCAA, SINCE 1990
LOV ......... A RIDER, NOT A STANDALONE POLICY
COVERS ...... A FALL IN DRAFT VALUE
OFFERED BY .. NOT THE NCAAIN FORCETwo products, two very different reputations.
Almost every conversation about this subject collapses two entirely separate products into one, so start by pulling them apart. Permanent total disability insurance pays a lump sum if an injury or illness ends a player's career before it starts. It has existed since 1990 through the NCAA's Exceptional Student-Athlete Disability Insurance programme, originally for football and men's basketball and later extended to baseball, men's hockey and women's basketball. It is uncontroversial, widely bought, and usually paid for by the school. Loss of value is something else entirely: a rider bolted onto a disability policy that pays out if a player is injured, recovers well enough to play professionally, but falls far enough down the draft to cost himself money. It is the product this file is really about, and the NCAA does not offer it.
02
NCAA POSITIONFORM A-2
Loss of ValueAVAILABLE ... NOT THROUGH THE NCAAREASON ...... INCONSISTENT BENEFIT TO CLAIMANTS
CITED ....... COMPLEX POLICY WORDING
CITED ....... SUBJECTIVE UNDERWRITING
CITED ....... FREQUENT LITIGATION
ADVICE ...... TOP-10 PROJECTIONS ONLYDECLINEDThe clearest warning in the file comes from the governing body itself.
The NCAA's own published position on loss-of-value cover is remarkable, and it is the single most useful thing a player can read before buying one. The association states that it does not offer the coverage because it has not been shown to consistently benefit student-athletes who file a claim, citing the complexity of policy wording, the subjective nature of underwriting a projected draft position, and the frequency with which claims end up litigated. It goes further and recommends that only athletes projected among the top ten picks in their draft should consider buying, on the grounds that anyone outside that range will struggle to prove what actually caused their earnings to fall. That is a governing body telling its own athletes that a product marketed to them is difficult to collect on.
03
SCHEDULE AFORM B-1
Coverage by ProjectionTOP 10 ...... $10M PTD PLUS $5M LOV RIDERPICKS 10-20 . $5M TO $7.5M PTD, $2M TO $3M LOV
PICKS 20-30 . AROUND $5M PTD
BELOW THAT .. LOV RARELY WORTH THE PREMIUMSCHEDULEIndustry rule of thumb rather than a published tariff.
Cover is rationed by projection. The industry rule of thumb, as described by the brokers who write these policies, is that a projected top-ten pick qualifies for around $10 million of permanent total disability cover with a $5 million loss-of-value rider attached. Players projected between ten and twenty get $5 million to $7.5 million of disability cover and $2 million to $3 million of loss of value. Between twenty and thirty, roughly $5 million of disability cover and often no rider at all. The logic is circular in a way worth noticing: the amount you can insure depends on a projection of where you will be drafted, and the thing you are insuring against is that projection being wrong.
04
PREMIUMFORM B-2
Cost of CoverPTD ......... ABOUT $7,500 TO $10,000 PER $1MLOV RIDER ... ABOUT $4,000 MORE PER $1M
EXAMPLE ..... $2M PLUS $2M RIDER, ABOUT $23,000
REPORTED .... ONE MICHIGAN TIGHT END, ABOUT $25,000
REPORTED .... ONE USC RECEIVER, $94,600DUEA premium is charged whether or not a claim is ever paid.
Disability cover runs at roughly $7,500 to $10,000 in annual premium per million dollars insured. A loss-of-value rider adds something like $4,000 more per million on top of that. So a player insuring $2 million of disability with a $2 million rider is looking at something in the region of $23,000 for a single season of cover. At the top of the market the numbers climb steeply: Florida State used its Student Assistance Fund to pay up to $60,000 towards Jameis Winston's loss-of-value premium on a $10 million package split evenly between the two products. The largest reported premium in this file belongs to a player who collected nothing, which is a fact worth holding on to.
05
FUNDINGFORM C-1
Premium SourcesROUTE 1 ..... STUDENT ASSISTANCE FUNDROUTE 2 ..... BORROW AGAINST FUTURE EARNINGS
ROUTE 3 ..... OUT OF POCKET
NCAA WAIVER . 2014, EXTENDED BORROWING TO LOV
CLAWBACK .... IF YOU TRANSFER OR TURN PRO EARLYFUNDEDWho signs the cheque turns out to matter enormously. See entry 10.
There are three ways a twenty-one-year-old finds twenty-odd thousand dollars. Schools commonly pay from the Student Assistance Fund, and one broker put it plainly: it is very rare now to find a programme that does not use its fund for this. Stanford's published policy is a good illustration of the shape of it, covering premiums up to a $3 million disability policy while leaving any loss-of-value rider at the athlete's own expense - and reserving the right to reclaim the premium if the player transfers or turns professional early. The second route is borrowing against future earnings, which the NCAA extended to loss-of-value premiums by waiver in 2014, having previously allowed it only for disability cover. The third is paying yourself, which almost nobody could do until very recently.
06
MECHANISMFORM C-2
The ThresholdPAYS ON ..... A CONTRACT BELOW A SET NUMBERNOT ON ...... THE INJURY ITSELF
EXAMPLE ..... A NOTRE DAME LINEBACKER
THRESHOLD ... $7.2M OVER FOUR YEARS
OUTCOME ..... DRAFTED 34TH, BELOW THE LINETRIGGEREDThe number in the contract does the work, not the medical report.
This is the mechanism people misunderstand most often. A loss-of-value policy does not pay out because a player was injured. It pays out because a specific financial threshold, agreed in advance, was not met. Jaylon Smith's policy is the clearest published example: it was written to respond if he did not receive an NFL contract offer worth at least $7.2 million over four years. He tore his anterior cruciate and medial collateral ligaments and suffered nerve damage in the 2016 Fiesta Bowl, having been projected as a top-five pick with some estimates putting his first contract near $20 million. He was taken 34th overall by Dallas. The injury was the cause, but the trigger was the number.
07
CLAIMS PAIDFORM D-1
The RegisterEKPRE-OLOMU . REPORTED $3,000,000JAYLON SMITH REPORTED $900,000
JAKE BUTT ... REPORTED $543,000
SILAS REDD .. PAID, UNDISCLOSED
E.J. BIBBS .. PAID, UNDISCLOSED
SIX-YEAR EST ABOUT $8,000,000 IN TOTALAPPROVEDA whole market's payout history, and it is shorter than a squad list.
Here is the complete publicly known record of players who have collected on a loss-of-value policy. Ifo Ekpre-Olomu tore an anterior cruciate ligament in practice days before Oregon's final game, fell to the seventh round, and reportedly received $3 million. Jaylon Smith reportedly received $900,000. Jake Butt of Michigan, who had bought a $2 million rider on a $2 million disability policy for a premium reported around $25,000, tore a ligament in the Orange Bowl, fell to the fifth round, and received a reported $543,000. Silas Redd of USC went undrafted and collected an undisclosed sum, as did E.J. Bibbs of Iowa State. In 2016 the NCAA's own magazine could identify only two athletes who had ever received a loss-of-value benefit, and a risk manager working in the field estimated the total ever paid at roughly $8 million across about six years. For an entire market, that is a rounding error.
08
CLAIM DENIEDFORM D-2
Marqise LeePREMIUM ..... $94,600, PAID 2013THRESHOLD ... A CONTRACT BELOW $9.6M
INJURY ...... KNEE, UNDER TWO WEEKS LATER
DRAFTED ..... 39TH, FOUR YEARS, $5.17M
SHORTFALL ... ABOUT $4.5M
INSURER ..... DENIED, REFUNDED PREMIUMDENIEDThe underwriter argued the policy had never taken effect at all.
Marqise Lee paid Lloyd's of London $94,600 in 2013 for cover against falling below a $9.6 million contract. Less than two weeks later he injured his knee. He never fully recovered his standing as the best receiver in the country, and in the 2014 draft he went 39th overall to Jacksonville on a four-year deal worth $5.17 million - roughly $4.5 million short of the number his policy named. Lloyd's declined the claim, alleging that he had concealed, misrepresented or omitted material medical information, refunded his premium with interest, and asked a court to declare that the policy had never taken effect in the first place. Lee sued for $5 million. Every element of the case he thought he had insured against happened exactly as anticipated, and the dispute was about something else entirely.
09
NO COVERFORM D-3
The UninsuredMcGAHEE ..... PROJECTED TOP FIVE, FELL TO 23RDMcGAHEE ..... NO LOV COVER
LATTIMORE ... FELL TO ROUND FOUR
LATTIMORE ... NEVER PLAYED AN NFL GAME
LATTIMORE ... NO PTD, NO LOVNEVER FILEDThe counterfactual that sells every policy in this file.
The sales case for this entire product category rests on two names. Willis McGahee was projected as a top-five pick before wrecking his knee in a national championship game; he fell to 23rd and had no loss-of-value cover, and the eighteen-place slide cost him millions in guaranteed money. Marcus Lattimore, a first-round talent after two seasons at South Carolina, suffered a catastrophic knee injury in his junior year, fell to the fourth round and never played a regular-season NFL game. He had neither policy. Those two cases are why brokers get return calls. They are also why the honest version of this article has to set them against the claims record in the previous two entries rather than in isolation.
10
EXCLUSIONSFORM E-1
Section FourNOT COVERED . A DROP CAUSED BY OTHERS IMPROVINGNOT COVERED . UNDISCLOSED PRIOR INJURY
NOT COVERED . A FAILED DRUG TEST
NOT COVERED . OFF-FIELD LEGAL TROUBLE
NOT COVERED . SIMPLY NOT BEING AS GOOD AS PROJECTEDEXCLUDEDUnderwriters note the conduct clauses have a useful side effect.
The exclusions are where these policies live or die, and the first one is the most instructive. If a player's draft stock falls because other players at his position performed better, that is not an insured event - even though the financial damage is identical. Undisclosed prior injuries void cover, which is exactly the ground on which the largest disputed claim in this file was refused. Failed drug tests and legal trouble are commonly excluded outright, a fact brokers have pointed out cuts both ways: a policy that lapses on a positive test is a reason to stay out of trouble. And a player who was simply overrated has no claim at all, because the policy insures a projection against injury, not a projection against reality.
11
TAX STATUSFORM E-2
OwnershipSCHOOL-FUNDED PROCEEDS ARE TAXABLESELF-OWNED .. PROCEEDS ARE TAX-FREE
SWING ....... CAN EXCEED $300,000 ON A LARGE CLAIM
NEW IN 2026 . ATHLETES NOW HAVE INCOME TO PAYELECTIONA structural decision made before the season, worth more than the season.
Here is the detail that has become genuinely consequential in the last eighteen months. When a premium is paid out of a school's Student Assistance Fund, the resulting claim proceeds are taxable income to the athlete. When the athlete owns the policy and pays the premium personally, the proceeds arrive tax-free. On a seven-figure claim, specialists put the difference at more than $300,000. Until recently that was an academic distinction, because a college player had no realistic way of funding a premium himself. Under the House settlement, schools have been sharing revenue directly with athletes since July 2025 - about $20.5 million per school in the first year, rising to roughly $21.3 million for 2026-27 - on top of third-party name, image and likeness income. For the first time, a player choosing between a free policy and one he pays for himself is making a real financial decision, and the free one may be the more expensive.
The Claims Register
Every publicly known outcome, filed together. Amounts are as reported.
| Player | School | Projected | Landed | Outcome |
|---|---|---|---|---|
| Ifo Ekpre-Olomu | Oregon | First round | Round 7 | Paid, reported $3,000,000 |
| Jaylon Smith | Notre Dame | Top five | 34th overall | Paid, reported $900,000 |
| Jake Butt | Michigan | Round 2 | Round 5 | Paid, reported $543,000 |
| Silas Redd | USC | Rounds 1-3 | Undrafted | Paid, undisclosed |
| E.J. Bibbs | Iowa State | - | Undrafted | Paid, undisclosed |
| Marqise Lee | USC | First round | 39th overall | Denied. Premium refunded. Sued for $5M |
| Willis McGahee | Miami | Top five | 23rd overall | No loss-of-value cover held |
| Marcus Lattimore | South Carolina | First round | Round 4 | No cover at all. Never played an NFL game |
The Arithmetic
Cover available against claims actually paid
The estimate of total claims paid comes from a risk manager working in the field and covers roughly a six-year span. It is the only industry-wide figure anyone has put on the record.
What a premium buys, and what it does not
The first exclusion on the right is the one that catches people. A player whose stock falls because the class around him got stronger has lost exactly as much money and has no claim.
The Record Book
The Alternative Is Not PlayingEvery December the same argument runs about star players skipping bowl games, and insurance is the reason it is an argument at all rather than a certainty. Christian McCaffrey and Leonard Fournette both sat out bowls to protect their draft position, and Fournette was reported to hold separate eight-figure disability and loss-of-value policies as well. A policy is what lets a player take the field for a game that can only cost him money. When the policy is hard to collect on, the rational move drifts back towards not playing - which is a problem for everyone selling tickets to a bowl game.
Written In LondonNearly all private loss-of-value cover for American college athletes is underwritten in the Lloyd's market in London, while the NCAA's own disability programme is underwritten by Tokio Marine HCC. That geography matters more than it sounds. A dispute over a knee injured in Indiana or Oregon is resolved under policy wording drafted for a market that has been insuring unusual risks since the seventeenth century, and the athlete on the other side of it is typically twenty-one years old and being advised by whoever his athletic department put him in touch with.
The Market Grew UpThe two-product market described in this file has expanded considerably since revenue sharing began. Temporary total disability cover, which pays a percentage of income during recovery rather than only on a career-ending injury, is now pitched at underclassmen who have earnings to protect. Contract and endorsement guarantees insure name, image and likeness payments themselves. In early 2026 a critical injury protection product arrived, letting schools and collectives insure the payments they owe an athlete who is hurt. Insurance always follows money, and the money arrived in 2025.
Insuring The DonorThe strangest product created by all this is one that does not protect the athlete at all. So-called booster insurance was developed as a direct consequence of the House settlement and pays out to the donors who funded a package to retain a player, in the event that player is subsequently injured. It is worth sitting with that for a moment. The market now offers a policy under which a young man gets hurt, cannot play, and the cheque goes to the people who paid to bring him to campus.
Sports-King's Note
Now for the fine printPayout figures throughout this article are as reported in contemporaneous coverage rather than from policy documents, which are private, and every one is described as reported for that reason. The permanent total disability programme referred to is the NCAA's Exceptional Student-Athlete Disability Insurance programme, established in 1990 for football and men's basketball and later extended to baseball, men's ice hockey and women's basketball, and underwritten for the NCAA by Tokio Marine HCC. The NCAA's stated reasons for not offering loss-of-value cover, and its recommendation that only athletes projected among the top ten picks consider it, are as published by the association. Premium guidance of roughly $7,500 to $10,000 per million of disability cover and roughly $4,000 more per million for a loss-of-value rider comes from brokers who write these policies and should be read as a range rather than a tariff; individual quotes vary with medical history, position and projection. The coverage ladder by projected draft slot is an industry rule of thumb described to ESPN by practitioners, not a published schedule. The estimate that roughly $8 million in total had been paid on loss-of-value claims across about six years comes from Ronnie Kaymore of Kaymore Sports Risk Management, and the observation that only two athletes were then known to have collected comes from the NCAA's own Champion magazine; both date from the middle of the last decade and later payouts have occurred, so treat the total as a floor rather than a current figure. Jake Butt's policy is described in some accounts as a $2 million rider on a $2 million disability policy and his premium reported at around $25,000; his payout is reported at $543,000. Marqise Lee's premium of $94,600, his threshold of $9.6 million, his $5.17 million rookie contract and the insurer's denial on grounds of non-disclosure are as reported at the time of his lawsuit, which he filed seeking $5 million. Revenue-sharing figures come from the House v. NCAA settlement approved in June 2025: a cap set at about 22 per cent of certain revenues, approximately $20.5 million per school for 2025-26 rising to roughly $21.3 million for 2026-27, alongside about $2.8 billion in back-pay damages. The tax treatment described in entry eleven reflects guidance from lawyers practising in this area and is not tax advice; any athlete should take his own. Nothing here is a recommendation to buy or decline cover.
One Last Word
There is something clarifying about reading this market as a claims file rather than as a product. A twenty-one-year-old is sold up to fifteen million dollars of cover on an asset he is not yet allowed to sell, at a premium somebody else usually pays, against a threshold somebody else calculated, subject to exclusions that include the most likely reason his value will actually fall. Then he plays the season anyway. The remarkable thing is not that so few claims have been paid. It is that the entire apparatus exists because the alternative - letting a young man carry that risk alone for one more year, for free - was somehow the arrangement everyone was comfortable with until very recently.
The hard numbers, for the road: permanent total disability cover has been available through the NCAA since 1990 and pays out if a career ends before it begins. Loss-of-value cover is a separate rider, is not offered by the NCAA, and the association states it has not been shown to consistently benefit athletes who claim on it, recommending only projected top-ten picks consider it. A top-ten projection buys roughly $10 million of disability cover plus a $5 million rider, at a premium of roughly $7,500 to $10,000 per million for the first and about $4,000 more per million for the second. The confirmed payout record is Ifo Ekpre-Olomu at a reported $3 million, Jaylon Smith at $900,000, Jake Butt at $543,000, plus undisclosed sums to Silas Redd and E.J. Bibbs - against an industry estimate of about $8 million paid in total across roughly six years. Marqise Lee paid a $94,600 premium, fell $4.5 million short of his threshold, was denied on grounds of non-disclosure and sued for $5 million. And a policy paid for by a school produces taxable proceeds while one an athlete owns himself pays out tax-free, a difference that can exceed $300,000 on a large claim.
