They're not left out on a broken limb

Edmund Tirbutt on the seven-figure insurance deals that protect sports stars and clubs from financial injury

Any sensible business will insure its main assets, whether it is spending pounds 15m on a footballer or a factory. So while it would be little compensation to Newcastle United fans if Alan Shearer picked up a serious injury, the club would be able to claw back some financial compensation.

"You can be absolutely sure that any sports star has been insured up to the full value of his contract to safeguard against disability," says Chris Branch, the managing director of Cigna Re Europe, a sports underwriter.

Around 50 professional footballers are forced to quit every year through injury. A single incident is rarely responsible. It is more likely to be a series of injuries to a particular joint, allied to the general ageing process of the body.

Any sporting risk as large as Shearer is split between at least 30 different insurance companies and syndicates worldwide. Around three-quarters of this business is underwritten in London, the world's leading market for professional sporting risks.

The same principles apply to top showbusiness personalities who depend on their fitness. Michael Flatley's much-publicised calf injury caused him to miss three Lord of the Dance shows recently, and while claims for ticket refunds were limited by the fact he had an understudy, his insurance took a minor knock.

A number of specialist intermediaries dominate particular sports. Windsor Insurance Brokers, for example, handles most professional footballers in Britain and all our county cricketers and licensed boxers.

All the full-time football leagues purchase block cover from Windsor against death or total disablement of their players while on the pitch. But the amount of insurance is relatively modest, so all Premier League clubs, most from the First Division and some from the lower divisions buy additional cover. The very top clubs will take this out for their entire squads, but others insure only their star names. Some players may negotiate with their club to receive a proportion of the payout should they be seriously injured.

The amounts insured can approach the transfer values of the footballers concerned: over 100 players in the Premier League are insured for pounds 1m or more.

Most clubs do not insure for short-term injuries because a large squad of players is a form of self-insurance. The appeal of cover for temporary disability is limited by the cost and by the fact that payment is not made for the first three weeks of disability.

The British Olympic team was also covered under a block policy through Windsor during the Atlanta games. But this was little more than a glorified travel insurance policy, covering baggage and the cost of medical treatment and repatriation for up to pounds lm per individual. Many of the athletes would also have had permanent health insurance to cover their mortgage. This pays a regular income in the event of long-term disability.

Insurers are loath to quote premiums for most sports, stressing that individual risks vary to an extent that precludes generalisations. But as to the level of cover it is not unusual for a Formula 1 driver, say, to take out pounds 3m against death and disability. Top drivers are insured for much more than this. The total claim on the Williams team's policy after Ayrton Senna's death in 1994 was said to have been $17.5m (pounds 11.3m).

Insurers emphasise that motor racing is now far safer than generally imagined thanks to huge improvements in cars and tracks. The same cannot be said, however, for professional motorbike riders. TL Clowes & Co, the leading broker for the motor sports market, says they would be virtually uninsurable if it wasn't for their willingness to ride with broken bones.

The same can be said for National Hunt jockeys, although up-and-coming riders are judged worse risks than the top ones because they have less incentive to carry on riding after an accident.

Participants in professional boxing, skiing, ice hockey and cycling also command some of the steepest rates. Golfers and volleyball players, on the other hand, tend to be good risks.

Chris Farley-West, the managing director of Europea-IMG, the sports insurance company, says sports people often delay arranging cover for longer than they should. "There's a big gap from having had nothing to having quite a lot, and many of them don't want to spend their new-found wealth on insurance."

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...

Ashdown Group: IT Manager / Development Manager - NW London - £58k + 15% bonus

£50000 - £667000 per annum + excellent benefits : Ashdown Group: IT Manager / ...

Recruitment Genius: Sales Consultant / Telemarketer - OTE £20,000

£13000 - £20000 per annum: Recruitment Genius: Scotland's leading life insuran...

Ashdown Group: Training Programme Manager - City, London

£40000 - £45000 per annum + benefits : Ashdown Group: Training Programme Manag...

Day In a Page

Where the spooks get their coffee fix: The busiest Starbucks in the US is also the most secretive

The secret CIA Starbucks

The coffee shop is deep inside the agency's forested Virginia compound
Revealed: How the Establishment closed ranks over fallout from Loch Ness Monster 'sighting'

How the Establishment closed ranks over fallout from Nessie 'sighting'

The Natural History Museum's chief scientist was dismissed for declaring he had found the monster
One million Britons using food banks, according to Trussell Trust

One million Britons using food banks

Huge surge in number of families dependent on emergency food aid
Excavation at Italian cafe to fix rising damp unearths 2,500 years of history in 3,000 amazing objects

2,500 years of history in 3,000 amazing objects

Excavation at Italian cafe to fix rising damp unearths trove
The Hubble Space Telescope's amazing journey, 25 years on

The Hubble Space Telescope's amazing journey 25 years on

The space telescope was seen as a costly flop on its first release
Did Conservative peer Lord Ashcroft quit the House of Lords to become a non-dom?

Did Lord Ashcroft quit the House of Lords to become a non-dom?

A document seen by The Independent shows that a week after he resigned from the Lords he sold 350,000 shares in an American company - netting him $11.2m
Apple's ethnic emojis are being used to make racist comments on social media

Ethnic emojis used in racist comments

They were intended to promote harmony, but have achieved the opposite
Sir Kenneth Branagh interview: 'My bones are in the theatre'

Sir Kenneth Branagh: 'My bones are in the theatre'

The actor-turned-director’s new company will stage five plays from October – including works by Shakespeare and John Osborne
The sloth is now the face (and furry body) of three big advertising campaigns

The sloth is the face of three ad campaigns

Priya Elan discovers why slow and sleepy wins the race for brands in need of a new image
How to run a restaurant: As two newbies discovered, there's more to it than good food

How to run a restaurant

As two newbies discovered, there's more to it than good food
Record Store Day: Remembering an era when buying and selling discs were labours of love

Record Store Day: The vinyl countdown

For Lois Pryce, working in a record shop was a dream job - until the bean counters ruined it
Usher, Mary J Blige and Will.i.am to give free concert as part of the Global Poverty Project

Mary J Blige and Will.i.am to give free concert

The concert in Washington is part of the Global Citizen project, which aims to encourage young people to donate to charity
10 best tote bags

Accessorise with a stylish shopper this spring: 10 best tote bags

We find carriers with room for all your essentials (and a bit more)
Paul Scholes column: I hear Manchester City are closing on Pep Guardiola for next summer – but I'd also love to see Jürgen Klopp managing in England

Paul Scholes column

I hear Manchester City are closing on Pep Guardiola for next summer – but I'd also love to see Jürgen Klopp managing in England
Jessica Ennis-Hill: 'I just want to give it my best shot'

Jessica Ennis-Hill: 'I just want to give it my best shot'

The heptathlete has gone from the toast of the nation to being a sleep-deprived mum - but she’s ready to compete again. She just doesn't know how well she'll do...