As college sports gear up to start paying athletes directly for the first time in over a century, insurance is stepping into the spotlight as a vital tool for managing the new financial risks schools will face.

A groundbreaking settlement between the NCAA and several major conferences is set to allow colleges to compensate athletes up to a total of $20 million per institution. This historic shift marks the first time athletes may receive direct payments from their schools, introducing significant financial stakes that were previously absent.

Tyrre Burks, CEO of Players Health—a firm specializing in sports insurance—explains why insurance has become essential. “Now that real dollars are at risk, we’re talking billions flowing to athletes. Universities are sharing athletic department revenue with players for the first time, so the exposure is huge,” Burks said.

Players Health offers schools a suite of insurance options designed to address these new challenges. While NCAA’s existing athlete accident insurance covers medical bills, it doesn’t protect schools against financial losses tied to player payments. To fill this gap, Players Health developed a critical injury insurance policy that kicks in if an athlete misses at least 40% of the season due to a covered injury. This parametric policy automatically triggers payment to the school—up to $1 million—based on pre-set injury conditions.

Using one of the largest amateur sports injury databases available, Players Health calculates individualized injury risk to determine premiums, giving schools a clear understanding of their financial exposure.

Another innovative product tackles the growing issue of player transfers. Since the NCAA introduced its transfer portal in 2018, athletes can switch schools more easily than ever, sometimes receiving upfront payments without ever playing a game for the paying school. Players Health’s contract protection insurance predicts transfer likelihood and offers coverage that mitigates this risk, helping schools avoid costly disputes and ensuring contract integrity.

Additionally, Players Health has created a “fair market value bonus” policy that allows schools to reward athletes indirectly for on-field achievements—something NCAA rules currently prohibit. If an athlete reaches certain milestones like all-conference honors or winning prestigious awards, the policy triggers payments to the school, which can then funnel benefits to the athlete. This structure helps athletes realize their full market value while keeping payments compliant with NCAA rules.

Big 12, SEC, and Big East schools have already started purchasing these policies as they prepare for the new era of athlete compensation.

Burks emphasizes that Players Health aims to do more than sell insurance. “We want clients to fully understand the risks they face and how our products help manage those risks. Our goal is to empower schools with data and insights, not just issue policies.”

As college athletics enters this uncharted territory of direct athlete payment, insurance products like these will be key to helping programs balance opportunity with financial security.