The NCAA News - News and Features

The NCAA News -- September 28, 1998

Association wide -- Women's basketball added to disability insurance coverage

BY KAY HAWES
STAFF WRITER

As elite women basketball players take the court this fall, they will have an option that never has been offered to women before -- NCAA Exceptional Student-Athlete Disability Insurance.

Last year, star athletes Kristin Folkl and Vanessa Nygaard of Stanford University and Nykesha Sales of the University of Connecticut suffered season-ending injuries when Folkl and Nygaard both tore the anterior cruciate ligaments in their left knees and Sales tore her Achilles' tendon.

Although none of the injuries turned out to be career-ending, the players' futures in professional basketball were in doubt for a while.

Had Folkl, Nygaard and Sales been male basketball players, they could have been protected by an NCAA program that covers career-ending injuries and future loss of earnings as professional athletes.

That program -- in existence since 1990 -- enables exceptional student-athletes to purchase a disability insurance contract with preapproved financing, if necessary. But until recently, the program was available only to exceptional student-athletes in men's basketball, football, baseball and ice hockey.

Why weren't women eligible?

The program insures only the salary of players -- not any ancillary income, such as from endorsements and related appearances, for example. And, professional women's basketball was in its infancy, with two new leagues -- the ABL and the WNBA -- and relatively modest salaries for most players.

"The professional market (for women) has just gotten up and running in the last couple of years," said Keith E. Martin, NCAA director of finance and business operations. "The insurance industry had to legitimize the market value of these players."

Marla Gleason, NCAA operations manager, explained how the market value and the resulting maximum benefit is calculated. "We attempt to insure about 60 to 65 percent of the average projected guaranteed earnings for the first three years of a professional career," Gleason said.

"This formula takes into account only income received for athletics performance, not income from endorsements or other sources. And, the maximums vary because average guaranteed earnings vary from sport to sport."

Marc D. Idelson, vice president at American Specialty Underwriters L.L.C. (the program's administrator), also pointed out that the benefit's tax-free status should be taken into account. "If they're making $140,000 per year before taxes, that amount times three is $420,000. After taxes, they would only keep about 60 percent -- or around $250,000. With the men, we've been a bit more conservative because of the amounts involved," he said.

Martin said the Association had been looking at the possibility of extending the program to exceptional women basketball players for a couple of years before the injuries to those high-profile players last spring.

"It heightened the awareness that there's a need out there," he said. "But the discussion was already in progress when those injuries occurred."

Martin cites several events that did affect the process: the United States' success in women's basketball in the 1996 Olympics and the advent of the two professional leagues.

One reason the program expansion could not come overnight had to do with how many entities are involved, Martin said.

"It's not just the NCAA. We're only one party. We have the insurance company, the banking relationship and the third-party administrator," Martin said. "We had to educate the insurance company as to the values of those (player) contracts."

Many of those who called for the NCAA to extend the program to women are pleased with the recent expansion.

"I'm delighted that the NCAA has moved aggressively and actively to open the program to women," said Cheryl Levick, senior associate athletics director at Stanford and current chair of the NCAA Committee on Women's Athletics, which recommended that the program be expanded to include women.

Her position at Stanford gave Levick a close-up look at the potentially devastating effects that career-ending injuries could have on exceptional women basketball players.

"Both injuries (to Folkl and Nygaard) could have been career-ending ones," Levick said. "Fortunately, they weren't. But I never want to be in that situation again with our women student-athletes."

Jean Lenti Ponsetto, senior associate athletics director at DePaul University, former chair of the NCAA Division I Women's Basketball Committee and current member of the Championships/Competition Cabinet, also is pleased with the expansion.

"I'm optimistic and excited that our women basketball student-athletes have this opportunity," Ponsetto said. "It's a great opportunity for student-athletes of the future."

Ponsetto, who recently agreed to serve on the Division I Working Group to Study Basketball Issues, points out that the growth of women's basketball has been intense over the past few years.

"I think the interest level (in women's basketball) has grown immensely, and as an Association, we need to keep pace." Ponsetto said.

Levick and Ponsetto also agreed that the Association should continue to review the program.

"I think it's important that the NCAA continue to look at adding other women's sports, such as volleyball and soccer," Levick said. "It's definitely a positive step in the right direction in terms of making sure that we offer comparable services and championships for our student-athletes, regardless of gender. Now I feel that there should be continued study and perhaps more teams added."

Protecting exceptional athletes

In 1990, the NCAA Exceptional Student-Athlete Disability Insurance program was initiated for exceptional student-athletes at NCAA institutions in the sports of men's basketball and football. In 1991, the program was expanded to include exceptional student-athletes in baseball, and it was expanded again in 1993 to include men's ice hockey.

Student-athletes are eligible under this program if they are in the designated sports, have athletics eligibility remaining at NCAA institutions and are projected to be selected in the first three rounds of the upcoming NFL or NHL draft or the first-round draft of the upcoming NBA, MLB, ABL or WNBA.

Only inquiries received directly from institutional representatives, student-athletes, parents or legal guardians of student-athletes will be processed in this program, and applications must be completed and processed to receive a quote of any kind. This restriction is intended to keep agents out of the picture.

"The program was really put in place initially to provide elite student-athletes with an alternative to going to an agent," Martin said, noting that the sports initially included -- men's basketball and football -- were those where that type of problem had been a concern.

Martin also noted that the maximum coverage amounts in all of the eligible sports were raised this year after a comprehensive review of the program.

"As salaries continued to escalate, we wanted to be competitive," Martin said.

Student-athletes who are approved for the program are automatically eligible for a loan, if necessary, to pay the premiums. The interest rate of the loan is competitive, and it does not require a co-signer.

The student-athlete repays the loan when he or she signs a professional contract or when the disability benefits become available due to a covered injury or sickness. If neither of those circumstances occur, the loan must be paid back when the coverage is no longer in effect and the loan note matures.

A happy ending

Fortunately, Folkl, Nygaard and Sales have moved past their injuries now, and there's no doubt about their ability to take their skills to the next level.

Nygaard was drafted by the WNBA's New York Liberty and will play next summer. The WNBA recently announced that Folkl and Sales will each be the anchor of a new WNBA franchise next year -- Folkl in Minnesota and Sales in Orlando.

While the story had a happy ending for the three high-profile student-athletes who were injured, future star basketball players may be able to avoid at least some of the hand-wringing that took place regarding those women's futures.

"There was a time between when the pro teams started and when the NCAA was able to put the program (for women) in place," Levick said. "For two years the student-athletes were in limbo. Now, they're not in limbo anymore."

Disability insurance

Sport -- Maximum Coverage

Men's Basketball -- $4.4 million

Football -- $3.0 million

Baseball -- $1.5 million

Men's Ice Hockey -- $1.2 million

Women's Basketball -- $250,000