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Insurance covers Manning, would help Broncos' cap

The SportsXchange

While the Denver Broncos were willing to stick out Peyton Manning's neck in terms of guaranteeing him $20 million in 2014, the team is covered by insurance if he is unable to play due to any other injury.

That is the simplified essence of the so-called "renegotiation" announced in the NFL's official transaction log -- the inclusion of an insurance policy that takes the Broncos off the hook for 2014 for an injury not related to his neck.

But if that happens, the team will get some salary cap relief. Denver submitted the contract with revised language to the NFL on Thursday. Manning's salary and salary cap numbers do not change, if he is healthy.

"It has no effect on the financial aspects of Peyton's contract, and it was expected once the guarantee came into play," said Manning's agent Tom Condon. "They'd certainly want to protect themselves in case of injury."

However, the change will help the team's salary cap position should the insurance clause be invoked. An insurance payment would be considered a "refund from the player," and would not counted against the cap. However, the cost of the insurance policy might count against the cap.

This insurance situation is covered in the Collective Bargaining Agreement, under Article 13, Section 6, Rule IV:

"In the event that a Club receives a refund from the player of any previously-paid Salary...such amount as has previously been included in Team Salary shall be credited to the Club's Team Salary for the next League Year... Insurance proceeds received by a Team as beneficiary to cover the player's inability to perform services required by his Player Contract shall be deemed a "refund from the player" if (a) the Club or the player purchased the policy (b) the amounts covered by the policy are so specified in the Player Contract; and (c) the policy is made available for inspection upon request by the NFL or the NFLPA."

When Manning signed with Denver in 2012, his $20 million salaries in 2013 and 2014 were guaranteed, but 2014 could be voided if Manning injured his neck in 2013. Manning , who turned 37 in March, is signed through 2016. However, each of the final two years of his contract could be voided if the team cuts him before the league year begins.
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