We are in the slowest time of the year for the business of the NFL, so I thought it’d be a good time to answer your questions. I put out a call and got a lot of repeat questions, so I’ll answer the most frequently posed ones here.and potential salary cap credits. Many have asked about an inside look at this practice. Here’s what I know.
Then there is TTD insurance, which will obviously trigger payouts much more often than PTD. But as you may expect, in a sport with a 100% injury rate, the premiums for TTD insurance are going to be quite high. Several insurance companies will not offer TTD, and the ones that do require potential exclusions for preexisting injuries. Per the article referenced above, TTD premiums to insure a contract of roughly $50 million could cost up to $2 million.
Having said that, if a team and owner’s goal is purely future salary cap credit, regardless of cost, this does have some potential value. Certainly, since my time in the NFL where our cap department was “me,” now NFL team cap departments have two to five people, sometimes more. They have more personnel and more resources to try to separate themselves from other teams; that is why I see this practice may be more popular.
Is this a practice that has been going on for years with NFL teams? Yes. But is it a massive loophole in the cap system? Not really. It’s just a tool that some teams and owners see value in—with a debate as to its cost-effectiveness—as a way to get back some cap room for future years.