When Football and Insurance Collide: The NFL Must Tackle Insurance Coverage Issues Following Concussion Litigation

By Rachael Marvin*

The NFL is no stranger to concussion litigation in 2019.[1]  Since 2011, concussion litigation has been a huge player in the personal injury realm of sports and employment law developments.[2]  As the NFL has grappled with increasing concerns about head-on collisions and player safety, so too have they faced issues related to insurance coverage.[3]  Specifically, insurance carriers have begun adjusting or removing their coverage policies for NFL teams, including a near elimination of NFL workers’ compensation coverage for football players.[4]  Additionally, the risk of traumatic brain injury lawsuits, and other serious injury litigation, looms over the heads of insurance companies who have policies with NFL teams.[5]  While the NFL will undoubtedly face personal injury litigation concerns in 2019, settling insurance coverage issues may be a top priority as well.[6]

A General Overview of NFL Concussion Litigation 

Beginning in 2011, the deaths and significant head injuries of high profile NFL players have fueled a string of litigation against the NFL.[7]  Since 2011, 4,800 players have brought suit against the NFL for head-injuries and their resulting long-term effects.[8]  In 2013, a federal lawsuit reached a $765 million settlement.[9]  Yet the judge initially rejected this settlement on the grounds that the amount fell short of the projected heath care needs of players.[10]  Therefore, the monetary issues and health care concerns have significant financial stakes for the NFL.[11]

In recent litigation, retired players successfully sought $3 million and $1.5 million for suits relating to the early onset of dementia.[12]  While both players and the NFL alike have moved towards settlements for numerous personal injury suits, the future of insurance coverage, as a result of this litigation, is hitting the NFL hard in 2019.[13]

NFL Insurance Policy and Coverage Changes

Prior to 2011, over a dozen insurance carriers contracted with the NFL to provide insurance coverage.[14]  Today, the NFL is facing insurance coverage changes as a result of the financial burden associated with head-trauma litigation.[15]  Specifically, insurance companies have largely eliminated general liability insurance coverage for head trauma.[16]  Berkley Entertainment & Sports is currently the only carrier offering head-trauma insurance coverage for NFL teams in 2019.[17]  This significant drop in available insurance provider coverage is reflective of increasing concerns regarding current and future NFL head-injury litigation.[18]  Insurance businesses are becoming increasingly reluctant to provide insurance coverage against the backdrop of million-dollar personal injury settlements for severely injured players.[19]  Furthermore, workers’ compensation was previously an available source of liability coverage, but this remedy is almost completely eliminated today.[20]  While the NFL may see more personal injury settlements for player lawsuits, it has yet to settle its shrinking coverage dilemma.[21]

The financial burden of concussion litigation and dwindling insurance coverage cannot be understated.[22]  With concussion litigation settlements currently valued at $1 billion, the NFL is facing high stakes concerning the future of providing insurance coverage against the payout of personal injury settlements for players.[23]  Some insurance companies have flat out refused to defend their policyholders in such matters, resulting in separate legal actions: insurance coverage disputes.[24]  Unfortunately for both sides, current case law is not directive; courts have not laid a foundation for deciding NFL-insurance coverage dispute lawsuits at this time.[25]

The NFL’s (Legal?) Future Remains Uncertain 

The NFL is not in trouble… yet.[26]  The NFL’s finances and ratings have remained strong, despite the increasing concussion litigation and resulting settlements.[27] However, the future of the NFL remains uncertain with rising insurance coverage issues. Football, like most organized sports, requires insurance coverage due to significant injury risks.[28]  Long-term player injuries, while today are pre-litigation, may require extensive future costs for the NFL.[29]  The success of plaintiffs in prior concussion litigation does not help; as it stands today, future plaintiffs will have a foundation for personal injury suits against the NFL, specifically those relating to head-trauma injures and cognitive problems associated with concussions.[30]

Given that liability insurance is inseparable from football, the NFL cannot ignore the developing insurance coverage issues.[31]  A method for improving the NFL’s prospects in 2019 is changing the game itself.[32] Specifically, one option is limiting the force applied during player collisions without changing the nature of tackle football.[33]  Another solution may require spreading players out on the field, and limiting closely spaced tackle drills.[34]  These solutions may provide a safety net for the NFL, reducing injuries and providing insurance companies with new safety objectives that reduce their liability concerns.[35]  After all, improving player safety is likely a win for all parties involved.[36]

* Staff Writer, Jeffrey S. Moorad Sports Law Journal, J.D. Candidate, May 2020, Villanova University Charles Widger School of Law.

[1] See Maryclaire Dale, Players Accuse NFL of Trying to Delay, Rewrite $1 Billion Concussion Settlement, Insurance Journal (Jan. 14, 2019), https://www.insurancejournal.com/news/national/2019/01/14/514686.htm (noting NFL’s engagement in concussion litigation, specifically regarding Alzheimer’s disease and dementia lawsuits from retired players, which may take NFL over 10-years to payout); see also Rick Maese, Dementia Claims in NFL Concussion Settlement Are Going Unpaid, Lawyers Say, Wash. Post (Mar. 20, 2018), https://www.washingtonpost.com/sports/redskins/dementia-claims-in-nfl-concussion-settlement-are-going-unpaid-lawyers-say/2018/03/20/00e635bc-2c7f-11e8-8ad6-fbc50284fce8_story.html?utm_term=.e88429b8419e (recognizing NFL’s part in “manipulating the settlement process,” and how concussion litigation is still ongoing due to NFL’s delay in paying out dementia settlements for all plaintiffs as only 183 ex-players had received settlement money in 2018). 

[2] See Steve Fainaru and Mark Fainaru-Wada, For the NFL and All of Football, a New Threat: An Evaporating Insurance Market, ESPN (Jan. 17, 2019), https://abcnews.go.com/Sports/nfl-football-threat-evaporating-insurance-market/story?id=60446104 (examining recent NFL concussion litigation developments, including changing insurance policies, with insurance companies becoming increasingly reluctant to insure football teams amidst head trauma litigation). 

[3] See id. (analyzing perspective of insurance carriers, including how companies believe traumatic brain injury litigation could “play out for decades,” leaving carriers with substantial medical bills and legal costs totaling billions of dollars). 

[4] See id. (noting that state workers’ compensation law changed in 2013 after successful suits by thousands of NFL players, most notably in California, which cost insurers millions of dollars). 

[5] See Jenna West, Report: NFL No Longer Has General Insurance Covering Head Trauma, Sports Illustrated (Jan. 17, 2019), https://www.si.com/nfl/2019/01/17/nfl-no-more-general-liability-insurance-covering-head-trauma (examining position that “insurance companies don’t want you” if your business is associated with football). 

[6] See id. (noting how changing insurance market is having large economic impact on football programs, including elimination of general liability insurance for traumatic head injuries). 

[7] See Fainaru, supra note 2 (recognizing origin of concussion litigation crisis and insurance companies dealing with fallout of litigation by backing away from sport with top carriers no longer covering head trauma injuries).

[8] See Eugene Lee, A Legal Analysis of the NFL Concussion Lawsuits, Sports & Ent. Beat (Aug. 28, 2014), https://www.gsblaw.com/sports-entertainment-beat/a-legal-analysis-of-the-nfl-concussion-lawsuits (acknowledging that issues of traumatic head injuries have gained significant attention through thousands of lawsuits filed by retired NFL players).

[9] See id.

[10] See id. (recognizing how NFL had to demonstrate how this settlement would adequately cover projected medical costs associated with players’ injuries).

[11] See Associated Press, NFL Drops its Appeal of Dementia Claims in $1 Billion Concussion Lawsuit, Market Watch (Jan. 10, 2019, 9:32 AM), https://www.marketwatch.com/story/nfl-drops-its-appeal-of-dementia-claims-in-1-billion-concussion-suit-2019-01-10 (examining payouts for plaintiffs in NFL’s concussion litigation settlements and financial implications for NFL).

[12] See id. (noting dementia settlement awards, which resolved litigation following NFL’s concealment of concussion risks).

[13] See West, supra note 5 (acknowledging insurance companies’ recent movement away from insuring football teams).

[14] See Fainaru, supra note 2 (recognizing that developments in tort suits have pushed insurance carriers away from involvement in NFL liability coverage). 

[15] See id. (examining time prior to 2011 when at least “a dozen carriers occupied the insurance market for pro football”). 

[16] See id. (noting that insurance companies are removing coverage options for head trauma injuries).

[17] See id. (recognizing that one insurance carrier, out of roughly a dozen previous carriers, provides only option for NFL head trauma insurance coverage today).

[18] See Mike Florio, Insurance is the New Existential Threat to Football, Supposedly, NBC Sports (Jan. 17, 2019), https://profootballtalk.nbcsports.com/2019/01/17/insurance-is-the-new-existential-threat-to-football-supposedly/ (acknowledging that “an evaporating insurance market” is affecting football programs across the board due to limited insurance coverage available for sport today).

[19] See Thomas M. Reiter and Lucas J. Tanglen, Concussions and Coverage: Insurance Claims Alleging Long-Term Brain Injuries, Including CTE, American Bar Association (Sept. 29, 2017), https://www.americanbar.org/groups/entertainment_sports/publications/entertainment-sports-lawyer/2017/fall2017/concussions/ (noting million dollar settlements for variety of personal injury lawsuits against NFL, and recognizing insurance companies’ preclusion of certain injuries in coverage disputes).

[20] See Fainaru, supra note 2 (examining position that workers’ compensation is not an available, or reliable remedy today due to significant state legislation changes).

[21] See Florio, supra note 18 (noting how NFL currently faces challenge regarding insurance coverage availability).

[22] See BBS Law Offices, NFL Concussion Settlements Approved and Cleared by Supreme Court, Legal News (Nov. 23, 2016), http://bbsatty.com/class-action/nfl-concussion-settlements-approved-and-cleared-by-supreme-court/ (evaluating current monetary value of concussion litigation against NFL and projecting payouts to players from settlements).

[23] See Lee, supra note 8 (detailing settlement awards and high cost of litigation for NFL).

[24] See Reiter, supra note 19 (recognizing that insurance companies’ decision not to provide coverage for certain injuries may cause additional disputes with NFL regarding insurance policy contracts).

[25] See id. (acknowledging current insurance coverage litigation and applicable case law and recognizing that courts today have “not yet clarified the application of key insurance coverage concepts in this field”). 

[26] See Dan Diamond, What ‘60 Minutes’ Didn’t Tell You About the Future of Football, Forbes (Nov. 15, 2015, 9:47 PM), https://www.forbes.com/sites/dandiamond/2015/11/15/60-minutes-says-the-nfl-is-in-trouble-heres-what-they-left-out/#3261bb502c74 (noting that NFL’s viewership has continued to increase, helping mitigate financial affects of litigation but that NFL’s legal and financial future remains uncertain with increasing insurance coverage and provider issues).

[27] See id. (addressing other financial factors that contribute to NFL’s overall success).

[28] See West, supra note 5 (addressing explicit need for insurance coverage).

[29] See Reiter, supra note 19 (recognizing NFL’s litigation future is not settled with previous payout plans for retired players).

[30] See id. (acknowledging that previous plaintiffs have brought successful tort suits against NFL).

[31] See Spencer Hall, The Future of Football, SBNation (May 1, 2017), https://www.forbes.com/sites/dandiamond/2015/11/15/60-minutes-says-the-nfl-is-in-trouble-heres-what-they-left-out/#3261bb502c74 (analyzing how relevant NFL’s insurance coverage issues are to game’s continued viability, specifically because head trauma is “inevitable” and such trauma is at heart of insurance coverage retreat).

[32] See id. (noting potential changes that could improve NFL player safety).

[33] See id. (acknowledging that tackle plays are a critical athletic and entertainment element of professional football programs). 

[34] See id. (recognizing that tackle drills and collisions are part of football tradition).

[35] See West, supra note 5 (analyzing how plans to reduce head injuries could combat the insurance coverage withdrawal).

[36] See Florio, supra note 18 (noting how concussion litigation, insurance coverage pullback, and financial burden on NFL could all be mitigated by improving player safety).