The secret market dictating World Baseball Classic rosters
How a lesser-known insurance company threw a wrench into the upcoming international baseball showdown.
Welcome back to Club Sportico, where we break down the intersection of sports and money—with an extra bit of humor and opinion. Today we’re talking about everyone’s least favorite subject.
The World Baseball Classic begins next week, and some of the sport’s biggest stars won’t be participating.
For most of them, it’s not due to existing injuries. Or load management from their MLB teams. It has nothing to do with travel, visas, or their home countries. Instead, the culprit is something way more mundane: they can’t get insurance.
It’s the reason second baseman Jose Altuve, who has more hits than any other MLB player over the past 12 seasons, won’t be suiting up for Team Venezuela. And the reason Elly De La Cruz, perhaps the sport’s most electric young star, won’t represent the Dominican Republic. It will also keep Shohei Ohtani from pitching (but not hitting) for Japan.
Coverage rejections were so common that Puerto Rico considered withdrawing from the tournament altogether. “It obviously will depend upon if we can figure out the substitute players,” an executive told The Athletic a few weeks ago. (The team did eventually fill out its roster.)
So what’s up with World Baseball Classic insurance? Who prices the policies, and who typically foots the bill? Is it a new phenomenon, or an age-old challenge? And how might it impact the tournament? Club Sportico made some calls this week to get a better handle on the issues. Here’s what we know.
Why do baseball players need insurance to play baseball?
Many of the players on WBC rosters—particularly contenders like Team USA, Venezuela, Japan or the Dominican Republic—are professionals currently under contract with their MLB teams. Not only are those contracts guaranteed for the players, they also often forbid the athletes from participating in activities that could lead to injury, disability or death.1
If an MLB franchise is going to let its ace pitcher or star shortstop run that risk while playing for his national team, it wants to protect itself from having to pay millions to someone who won’t be on the field. That scenario played out in 2023, when Altuve broke his thumb in the WBC, then missed the first 43 games of the Astros’ regular season (or when Mets closer Edwin Diaz tore his patellar tendon while celebrating a win during that same event2). To mitigate that risk, MLB requires that its players receive insurance to participate in the tournament.
How does this insurance actually work?
The World Baseball Classic is jointly owned by the MLB players union and the league itself, which has partnered with National Financial Partners to be the event’s broker of record. NFP evaluates all players based on a number of different factors—salary, contract length, position, age, prior injuries, etc.—before determining whether to offer coverage. Running everything through one broker should, in theory, result in better pricing, since NFP’s sizeable WBC portfolio gives it a wide variance of outcomes. For each player assessed NFP makes a binary choice, a yes or a no, it’s not a negotiation on the price of the premium.
The policies are paid by the WBC itself. If covered, a position player’s salary is guaranteed for two seasons; for pitchers, who have greater risk for long-term injury, it’s four years.3
While NFP makes those determinations itself, there is some wiggle room. The MLBPA and MLB were reportedly lobbying the broker to reconsider some decisions in the days before rosters were announced earlier this year. Some of those negotiations did bear fruit. After initial rejections, Puerto Rico relievers Jovani Morán (Red Sox) and Luis Quiñones (Twins) were later approved for coverage.
Is NFP’s ultimate ruling final?
No. There is a secondary market for players to source accidental death and dismemberment insurance elsewhere if refused by NFP. I talked to Todd Simkin, head of insurance businesses at River’s Edge, who said his company has written a small handful of policies for players seeking another avenue. While he declined to comment on the players specifically, he said they were all bought by their MLB team.
That said, he has explored solutions where a player pays for his own coverage. That’s less clean, however, since it’s the team, not the player, who is suffering the financial loss in the event of an injury.
“The player paying has this additional complication where you need a direction-of-pay letter, because obviously they can’t be the beneficiary of the policy,” Simkin said in an interview. “So if that’s the case, why not just have the team be the named insured? We’ve also seen agents that have proposed paying for the coverage. Again, for us, we don’t really care whose name is on the policy.”
Players can also play uninsured, provided their MLB team allows it. That happened in 2023 with Miguel Cabrera, who was set to make $32 million from the Detroit Tigers in the final year of his Hall of Fame career.
Is everyone happy with the arrangement?
LOL. Of course not!
There’s been a lot of anger and frustration about the process. Some were upset about how long it took NFP to inform teams of who would and who wouldn’t receive coverage. Others have claimed that the NFP process treated American and Japanese players more favorably than those from Latin American countries.
Venezuela infielder Miguel Rojas (Dodgers) was denied coverage to play for Venezuela. Why? Because he’s 37 years old. According to The Athletic, while players that age have been offered coverage in the past, it’s a non-starter for NFP this year.
“My only question is: Why is it just with our countries [in Latin America], like Venezuela, Puerto Rico, a couple Dominican players?” Rojas said in January. “I don’t see that happening with the United States or happening with Japan. And I’m not trying to attack anybody, or attack what’s going on ... but at the end of the day, it feels like it’s just happening with the players that want to represent their country from Latin America. So, there’s a lot of things I would like to talk about with someone in control, with someone from MLB.”
While the insurance denials have definitely hit Latin teams harder, U.S. and Japan aren’t unaffected. In addition to Ohtani’s pitching, American outfielder Mike Trout (Angels) couldn’t get coverage, which means we won’t have a repeat of the storybook ending from the 2023 event.
Are there other automatic disqualifications?
It appears so. That same story says that recent surgeries or trips to the 60-day injured list are grounds for refusal. That’s likely why Puerto Rico shortstop Francisco Lindor (Mets), who has had multiple surgeries on his right elbow in recent years, was denied coverage. By contrast, Team USA third baseman Alex Bregman (Cubs) missed nearly two months of games last year with a strained quad but did not have surgery and did not go on the 60-day IL. He was approved to play in the WBC.
Is it different this year?
Insurance has been an issue in previous iterations of this tournament. Oft-injured Clayton Kershaw was denied coverage in 2023 and was not given the Cabrera green light from the Dodgers.
That said, things are definitely heightened this year. The league’s insurance provider is more discerning than in years past, multiple people told us, and accidental death and dismemberment insurance is more expensive to acquire right now than it has been historically. This is in keeping with a broader trend in insurance following the COVID pandemic.
One nice thing, according to Simkin, is that it’s a relatively simple pricing challenge for the insurance broker. “It’s time bound and geographically bound,” he said. “We know when they’re going to be playing, we know where they’re going to be playing them. This is very clean.”
Will this impact the tournament results?
Yes and no. Some teams look very different now than they did a few months back. Puerto Rico is without Lindor, Carlos Correa (Astros), José Berríos (Blue Jays), Emilio Pagán (Reds) and others; Venezuela is without Altuve, Rojas, Carlos Narváez (Red Sox), Martín Pérez (Braves), and more. Neither team’s title odds have moved much despite the changes.
Team USA remains the favorite by quite a margin. But Canada was favored in men’s hockey at the Olympics and we all saw how that turned out… 🦅🦅🦅
Jacob’s 🔥 Take: 2023: World Baseball Classic. 2025: 4 Nations Face-Off. 2026": Olympic hockey tournament and another WBC. Whatever the NFL is going to do with flag football, and then another Olympic cycle that could feature pros from all five of America’s biggest men’s pro sports leagues. These international competitions are increasingly popular—and therefore increasingly common.
Every league needs to figure out a solution to ensure stars who want to compete are able to. The easiest option is looking to soccer, where FIFA seems to have eased tensions between club and country in 2012 when it created its own compensation program for teams that lose players to injuries suffered during international duties. Presumably, FIFA then took out an insurance policy of its own.
On the most recent Sporticast episode, Eben and Scott talked about the business halo of that hockey gold medal and the economics of USA Hockey 👇
Club Sportico is a community organized by Sportico, a digital media company launched in 2020 to cover the business side of sports. You can read breaking news, smart analysis, and in-depth features from Eben, Jacob and their colleagues at Sportico.com, and listen to the Sporticast podcast wherever you get your audio. Contact us at club@sportico.com.
If that sounds harsh, it’s literally the name of the coverage: accidental death and dismemberment (AD&D) coverage.
He’s playing this year, FYI, though his brother Alexis was reportedly among the Puerto Ricans denied coverage.
Do insurers differentiate between field positions? Here’s Todd Simkin: “There is a differences, but they don’t actually shows up in pricing. Outfielders should have different types of injuries than infielder do, but those differences are small.”