Most players who had expected to be drafted by now mutter expletives with each passing pick that doesn’t result in their name being called. Former Michigan tight end Jake Butt has less reason to dabble in words containing as many letters as his last name.
Via Darren Rovell of ESPN.com, Butt has a loss-of-value policy that began paying him $10,000 for each spot he fell in the draft, starting with the middle of the third round. By the end of the night, per Rovell, Butt had become eligible for roughly $150,000. (The math seems a little fuzzy, given that round three included 11 extra compensatory picks.)
Butt tore an ACL in the Orange Bowl. Rovell reports that Butt purchased a $2 million total disability policy with a $2 million loss-of-value policy rider before the start of his final season at Michigan. The loss-of-value protection cost $25,000; the report doesn’t mention the price of the base policy.
While it’s good that Butt has financial protection, he’s losing more than $10,000 in contractual value with each passing pick. Also, collecting on an insurance policy is slightly more difficult than getting cash from an ATM. Since money is the sole commodity of the insurance industry, insurance companies love to take it in — and they hate to pay it out. If they can find any plausible reason (and maybe a few implausible ones) to deny or limit payment, they will.
Besides, it’s always better to not have to collect on an insurance policy, since that necessarily means something less than ideal has occurred. For Butt, who played in a postseason game that didn’t have championship implications, the incremental risk resulted in a worst-case scenario. Given that both Leonard Fournette and Christian McCaffrey passed on their bowl games and still went in the top 10, more college football players who are expected to make plenty of money for playing football after playing football for free for three or four years should consider making a business decision.
Eventually, someone is going to make that business decision not before the last game of the season, but before the first one, sitting out a full season before finally becoming draft eligible.