Last Updated on October 15, 2026 by Syed Sarim Naqvi
Athlete disability insurance pays out if an injury or illness ends a playing career, and a “loss of value” add-on can pay when an injured athlete still plays but is drafted lower or signs a smaller contract. Reported premiums run about $7,500 to $10,000 per $1 million of total disability cover, plus roughly $4,000 per $1 million for loss of value, and the hardest part is getting a claim paid.
Key Takeaways
- Permanent total disability (PTD) cover pays when an athlete can never play professionally again, while loss of value (LOV) protects future contract value after a significant injury or illness
- The NCAA’s disability program offers maximum cover from $250,000 (women’s basketball) up to $10 million (football and men’s basketball)
- Reported costs are roughly $7,500 to $10,000 per $1 million for PTD and about $4,000 per $1 million for the LOV rider
- The NCAA says it does not offer LOV because it has not consistently benefited athletes who claim, so LOV is bought on the private market
- LOV must be bought with PTD, needs medical underwriting and comes with exclusions, and disputes often end up in confidential arbitration
What Is Athlete Disability Insurance?
Darras Law describes permanent total disability insurance as cover against the financial losses of a career-ending injury that stops an athlete from ever playing professionally. It is sold through the NCAA’s Exceptional Student-Athlete Disability Insurance program and by private markets such as Lloyd’s of London. A Wong paper on athlete disability notes that policies rest on three components: the coverage amount, the term and the premium, and that payout often turns on whether the athlete suffered a “career-ending” injury, a term open to debate.
PTD or Loss of Value: What Is the Difference?
| Cover | Pays When | Key Catch |
|---|---|---|
| Permanent total disability (PTD) | The athlete suffers a total disability and cannot participate in the sport again | Requires a permanent, total loss of playing ability |
| Loss of value (LOV) | An injury or illness pushes future contract value below a pre-agreed amount, for example through a drop in draft position | Sold only with PTD and needs medical underwriting |
How Much Does It Cost?
PropertyCasualty360 reports an estimated $10,000 per $1 million of total disability cover and about $4,000 more per $1 million for LOV. A long-term disability law firm puts the PTD premium at $7,500 or more per $1 million, with the same roughly $4,000 for the LOV rider. The gap shows why these are estimates, not quotes. As an illustration only, $5 million of PTD cover at $7,500 to $10,000 per million would cost $37,500 to $50,000, and a $5 million LOV rider at $4,000 per million would add about $20,000.
Because premiums are high, many athletes do not pay them personally. Sources note that colleges often fund the policy, and that the NCAA permits schools to use its Student Assistance Fund to help pay for eligible athletes’ disability and loss-of-value coverage.
Who Is Eligible for the NCAA Program?
LSU’s compliance office explains that athletes with remaining eligibility who are projected to be picked in specified rounds can enter the NCAA Exceptional Student-Athlete Disability Program: the first three rounds in football, and the first round in men’s basketball, baseball and women’s basketball. It adds that LOV must be bought alongside PTD and is typically purchased for the year before an athlete becomes draft-eligible. PropertyCasualty360 reports the program’s maximum cover ranges from $250,000 for women’s basketball to $10 million for football and men’s basketball.
Why Is Loss of Value So Controversial?
The NCAA’s stated position, quoted by PropertyCasualty360 and Darras Law, is that it does not offer LOV because the coverage has not been shown to consistently benefit student-athletes who file a claim. Darras Law says LOV riders have generated far more legal battles than PTD cover, because they pay an athlete who can still play but whom the market values less than before. PropertyCasualty360 adds that LOV requires medical underwriting and comes with a list of exclusions. The Wong paper notes that nearly all disability policies send disputes to confidential arbitration, so little litigation and little public data exists.
Does Loss of Value Ever Pay Out?
Yes. A long-term disability law firm points to Michigan tight end Jake Butt, who in January 2017 was among a handful of college athletes to collect on loss-of-value insurance. The same article stresses that not every policy is equal, so the wording on triggers, thresholds and exclusions matters.
What Should You Check Before Relying on a Policy?
- The trigger: how “career-ending” or “loss of value” is defined, and by what measure
- The coverage period: the policy only responds to injuries during its designated term
- Exclusions: pre-existing conditions and underwriting limits
- Premium payment: late payment can lapse cover, so confirm who pays and when
The figures above come from sources published between 2017 and 2020, and college sports rules have changed since, so confirm current NCAA program terms before making decisions.
How Does This Connect to the Rest of Specialty Insurance?
This is the individual version of insuring a talent that earns the money. Compare it with Sports Stars Who Insured Their Bodies for Millions, with Esports Insurance: Hands, Eyes and Wrists, and with the company-side view in Key Person Insurance Explained. For physically dangerous work, see Stunt Performer Insurance Explained.
FAQ
What is permanent total disability insurance for athletes?
It pays if an injury or illness permanently stops an athlete from playing professionally.
What is loss of value insurance?
It pays when an injury or illness lowers an athlete’s future contract value below a set amount, such as through a lower draft position.
How much does athlete disability insurance cost?
Reported estimates are about $7,500 to $10,000 per $1 million of PTD cover and roughly $4,000 per $1 million for LOV.
Does the NCAA offer loss of value insurance?
No. The NCAA offers PTD through its disability program but says LOV has not consistently benefited athletes who claim.
Who pays the premium?
Often the school, sometimes using the NCAA Student Assistance Fund, though athletes can also buy cover privately.
Can I buy loss of value without disability cover?
No. The industry requires LOV to be bought together with PTD, typically for the year before draft eligibility.
Have athletes actually collected?
Yes. Michigan’s Jake Butt was among a handful of college athletes who collected on LOV insurance in January 2017.
Glossary
- Permanent Total Disability (PTD): cover for an injury that permanently ends an athlete’s ability to play professionally.
- Loss of Value (LOV): a rider that pays when an injury reduces expected contract value below a set level.
- Exceptional Student-Athlete Disability Insurance (ESDI): the NCAA program offering PTD cover to eligible athletes.
- Student Assistance Fund: NCAA money that schools may use to help with eligible athletes’ needs, including premiums.
- Underwriting: the insurer’s medical and risk review before issuing cover.
Sources
- PropertyCasualty360: How Insurance Can Protect the Future Earnings of Top Athletes (NCAA coverage maximums, premium estimates, LOV exclusions)
- Long Term Disability Lawyer: Questions to Ask When Buying Loss of Value Insurance (premium figures, Jake Butt, Student Assistance Fund)
- Darras Law: Loss-of-Value Insurance for College Athletes, Trouble Ahead (NCAA position, disputes)
- LSU Compliance: Disability and Loss of Value Insurance (eligibility rounds, how LOV is bought)
- Glenn Wong (bepress): research paper on athlete disability insurance (policy components, arbitration)
- Nebraska Law Review: An Overview of the NCAA Insurance Policies Available to Student-Athletes (NCAA program context)
Related reading: Film Cast Insurance Explained · Content Creator and Influencer Insurance Explained · Adventure Sports Travel Insurance Explained
Published October 2026. Prices and plan terms vary by insurer and change often; always read the definition of disability and the exclusions, and refresh this article periodically.
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