Shiny Glossy American Football Ball IconInsurance claims could spike for sports-related brain injuries in the U.S. and U.K., thanks to increased awareness in both countries and a high-profile settlement involving National Football League players in 2015, Standard & Poor’s warns in a new report.

The ratings agency’s worries revolve around a nearly $1 billion settlement approved in 2015 by the U.S. District Court for the Eastern District of Pennsylvania involving 20,000 NFL players who retired before July 2014 and now suffer from different degenerative brain diseases. Terms leave the NFL liable to pay up to $5 million for each player who has a serious brain condition related to repeated head trauma. As well, relatives of players with brain conditions who died between January 2006 and 2015 are entitled to up to $4 million in cash per player.

As Standard & Poor’s noted, many players are appealing the settlement amount, arguing that it does not adequately compensate for their injuries. That means the final monetary amount could grow even higher, though no cash will be paid out until the appeals process ends.

All of this creates uncertainty in the eyes of insurers, S&P said.

“Although the impact of the settlement on liability insurers is unclear, they are still worried,” the S&P report noted.

With that said, S&P pointed out that insurers have learned their lessons from asbestos-related claims ($200 billion to $275 billion for past, present and future U.S. asbestos claims, according to the American Insurance Association) and are trying to plan accordingly, a move that could help them in the end in terms of dealing with sports-related brain injuries.

“Although we see similarities between sports-related brain injury claims and asbestos-related claims, we don’t believe that the ultimate cost of the former will reach that of the latter,” Standard & Poor’s noted. “U.S. insurers have learned from their experience … and are increasingly drafting exclusion clauses for concussion claims and capping concussion lawsuit payouts.”

Similarly, S&P said that the U.K. industry is taking prudent action.

“We believe that the U.K. insurance industry is well placed to set enhanced monitoring and prevention standards to mitigate its exposure to sports-related brain injury claims,” the Standard & Poor’s report stated.

Even so, as S&P pointed out, the rise in sports-related concussion claims in both countries is worth watching.

“The NFL has disclosed that its players sustained 271 reported concussions in preseason and regular-season games in 2015, a 32 percent rise over the 2014 season and the highest number in four years of record keeping,” Standard & Poor’s said. The spike is coming from increased player awareness of how important it is to report concussions. Club staff is also more sensitive to reporting and monitoring concussions during games and practices, S&P said.

Standard & Poor’s said that legal action involving sports-related brain injuries is not common in the U.K., but expects this will change.

“We believe that it may only be a matter of time before such cases increase in the U.K.,” Standard & Poor’s said in its report. “Awareness of this problem is on the rise. The Sports Collision Injury Collective recently highlighted the dangers of sports-related concussion in an open letter to government ministers, chief medical officers, and children’s commissioners, and requested a ban on the collision elements of rugby played in British Schools.

What’s more, Standard & Poor’s said recent high-profile cases in the U.K. have drawn media attention, which will, in turn, heighten sports concussion awareness there.

Source: Standard & Poor’s