The Hidden Costs of NIL: How Injuries and Insurance Impact Athlete Earnings

Introduction

As collegiate and amateur athletes increasingly capitalize on Name, Image, and Likeness (NIL) opportunities, the stakes surrounding injury management, recovery timelines, and long-term health have never been higher. Sports medicine surgeons are uniquely positioned at this intersection of medicine and money—not only providing expert care, but also helping athletes, families, and institutions understand the medical implications of NIL earnings, injury-related risks, and the importance of adequate insurance coverage. Below, a brief explanation of each and how they can affect NIL deals.

Earnings

Not all NIL deals are created equal. Some athletes are earning millions while the majority are earning less than $100 per year.¹ In 2024, the National Collegiate Athletic Association (NCAA) released the NIL Assist tool to increase transparency as well as provide student-athletes with information about average earnings, earnings by sport, and transaction types. Only 1% of athletes earned more than $50,000, and 41% of all NIL deals were allocated to collegiate football players.² NIL transaction types included social media posts, autographs, public appearances, outside employment, company royalties, business ownership/creations, and sports camps/lessons.

Currently, NIL deals are regulated by individual state laws and university guidelines. Most universities require athletes to report potential NIL deals before signing and some universities prohibit NIL deals regarding products that would be seen unprofessional/inappropriate (ie drugs and alcohol). There is an NIL “cap,” or maximum amount of money, a university can spend on student-athletes through NIL revenue sharing. This is calculated using a percentage of the institution’s ticket sales, sponsorships, and media rights, which totals approximately 22%. Using this formula, this corresponds to an estimated $20.5 million for the 2025-2026 academic year.³

Injuries

One big question on many athletes’ minds is, “Can injury affect NIL deals?” The straight answer is no, but this could be a little more complicated than it seems. Current NCAA rules prohibit NIL contracts for “compensation for athletic participation or achievement.” In short, an athlete’s performance cannot be considered for NIL compensation; rather, their sports performance can enhance their value. As protection for the athletes, it is against current NCAA NIL rules for contracts to include stipulations that would decrease compensation or dissolve an agreement if a player is injured. However, the extent of the athlete’s protection may be based on the actual language of the contract itself. Companies and collectives do attempt to protect themselves by using vague language. For example, if an athlete’s marketability is ‘impaired,’ payment could be decreased or stopped, and one could argue that many things fall into the category of ‘impairment,’ including injury. Furthermore, direct language about injuries that occur ‘off-campus’ may be utilized to withhold revenue. Added to the complexity of these issues is whether a company would try to enforce these clauses in a contract. One could imagine a public relations nightmare if a company withheld NIL payments due to a player’s injury. With that in mind, athletes do have some leverage when it comes to their NIL deals, but unlike the professionals, college sports do not have a formal injury settlement structure as NIL is still in its infancy.

Sports Insurance

Beginning August 1, 2024, the NCAA created a two-year post eligibility insurance program to support athletes who suffered injuries during their competitive years. This program covers excess accident medical expenses (up to $90,000) for related injuries sustained during competition for all intercollegiate sports at all divisions.⁴ The injury must have been reported by the athlete to their academic institution; the two-year eligibility period begins when the student either voluntarily withdraws from competition or exhausts athletic eligibility.⁵ Since most student-athletes are making very little from NIL, it is important that the NCAA provides this post-eligibility insurance to help cover the potential high costs of athletic injuries while students are making the transition to the normal workforce following graduation/sports completion. Furthermore, injuries attained while participating in NIL events (autograph sessions, training camps, etc.) are covered for the time being under this sports insurance program.

More Than Just Medical: How Surgeons and Team Physicians Can Help

It is the job of the team physician/orthopaedic surgeon to be aware that NIL should not affect their ability to provide care. Regardless of an individual athlete’s NIL deal, it is the responsibility of the team physician to provide the athlete with the highest level of medical care including diagnosis, treatment, and postoperative rehabilitation. The revenue infused in college sports by NIL also increases the potential for malpractice litigation; therefore, it is imperative that team physicians provide clear and thorough medical documentation for every episode of care. Lastly, team physicians must maintain an athlete-centered approach regardless of external pressures (agents, coaches, sponsors etc.) and adhere their actions to the highest ethical standards.

References

1. Sanders, Dylan. Shocking New NCAA Data Reveals Numbers for Average NIL Deals. Accessed May 8, 2025.
2. NCAA NIL Data Dashboard. Accessed May 8, 2025. https://nilassist.ncaa.org/data-dashboard/
3. O’Rourke, Patrick. Estimated NCAA Revenue Sharing 2025-26. Accessed May 8, 2025. https://nil-ncaa.com
4. How Does NIL Affect College Sports Insurance? Accessed May 8, 2025. https://agspecialtyinsurance.com/news/ncaa-nil-policy-sports-insurance-changes/
5. NCAA Post-Eligibility Insurance Program. Accessed May 8, 2025. https://www.ncaa.org/sports/2023/8/17/ncaa-post-eligibility-insurance-program.aspx#:~:text=TWO%2DYEAR%20COVERAGE,an%20eligible%2C%20documented%20athletic%20injury