The recent narrative on former Green Bay Packers tight end Jermichael Finley has centered on his decision about his NFL future. Since receiving "full clearance" to play football after suffering a career-threatening neck injury on Oct. 20, does he collect $10 million from the disability insurance he purchased before his injury or give that money up by coming back to play?
"If I quit the game right now, I can take tax-free money [from my insurance policy], and that's a difficult thing that I'm going through with myself," Finley
But an insurance executive and insurance recovery attorney tell Yahoo Sports it's highly unlikely Finley will have that kind of decision to make. In fact, some of the comments made by Finley's agent, Blake Baratz, call into question whether the talented tight end will be able to collect any portion of that $10 million insurance policy.
"Dr. Maroon, the [Pittsburgh] Steelers neurosurgeon performed the surgery and actually just gave him full clearance the other day," Baratz told ProFootballTalk Live in May. "It's not gonna be a no-brainer … decision that Jermichael's just going to come back and play football. He's protected financially with a big disability insurance policy [if he decides not to come back and play]."
While the language in policies varies by provider, permanent total disability (PTD) policies generally don’t pay out unless a player experiences a disability that prevents him from playing professional football again, said Chris Larcheveque, executive vice president of International Specialty Insurance.
Two recent examples of players fitting in that category are Giants RB David Wilson, who suffered a serious neck injury, and Baylor basketball player Isaiah Austin, who was diagnosed with Marfan Syndrome.
"Where they hurt themselves, is they put out the theory that he's OK to play football," Larcheveque said. "Why would Lloyds [of London] pay $10 million on a disability policy if the player and his agent put in their head that he actually can play the game? Lloyds is going to tell the judge when they go to court, and they're going to go to court, that a top surgeon says he can play, and that he's not totally permanently disabled which is what he has to be to collect that money. His agent laid the foundation for Lloyds to make their argument."
Baratz declined to comment on this story.
Insurance recovery attorney Noel Paul of global law firm Reed Smith LLP, says Larcheveque's analysis is correct, but cautions that it's difficult to be definitive without seeing the exact language of the policy Finley purchased.
"These insurers are looking at precedent," Paul said. "If the insurer thinks that Finley and his agent are trying to leverage Finley's insurance coverage in order to extract a better contract, but at the same time they're saying he really can play, the insurer is going to be very leery of paying out that policy. Doing so may create a precedent of providing coverage even where there are plenty of signs that the player is healthy enough to compete."
While discussion about whether Finley decides to collect the money from his disability policy or play the game is intriguing, it wouldn't be taking place had he purchased a "loss of value" policy in addition to his disability policy. Loss of value insurance is designed to cover a player for the difference between what he would have made if healthy and what he ends up making after an injury or illness. In Finley's case, he was seen by many as one of the NFL's top-10 tight ends. He likely would have fetched more than $5 million per year in free agency if healthy.
Assume Finley fetches only $1 million per year on the open market because of his injury. Loss of value would have theoretically paid him that $4 million difference.
It's unclear why Finley didn't have a loss of value policy but he told MMQB in October of 2013 that his agent and financial advisers pushed him to purchase a disability policy.
A source close to the situation says Baratz wasn't sold on the idea of purchasing loss of value because of the cost and the definitions in the policy.
Larcheveque says Finley likely paid in the ballpark of $100,000 for the disability coverage, while loss of value would have cost an additional $30,000-$40,000.
"If he would have had [loss of value], he would have the ability to collect $3 [million] to $4 million tax free," Larcheveque said. "Should [Finley] be cleared to play, it certainly will muddy the water from a claim standpoint but does not make [him recovering] an impossibility. The policies do contain what's known as a rehab clause – for the NFL, a four-game period in which the player can come back. If he re-suffers an injury, or gets a second opinion determining him to be [permanently totally disabled], the claim may be viewed as valid."
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