Insurance and Why “There’s Not Going to Small Promoters Doing MMA in New York”

Posted: March 27, 2016 in New York Combat Sports Law, Uncategorized

Now that the hangover from the celebration of soon to be legal MMA in New York is over its time to face one sober reality. New York’s legislation will, in practice, only allow the biggest players to legally host professional MMA bouts in the State.  Why?  The legislation brings with it a steep insurance requirement, one that only deep pocketed promoters can realistically hope to afford.  In short the legislation requires a minimum protection of $50,000 of coverage per licenced professional for medical surgical and hospital care for injuries sustained in an event.  Additionally the insurance must offer a further minimum of $1 million of coverage for “life-threatening brain injury“. The relevant provisions read as follows:

 All persons, parties or corporations having licenses as promoters
    14  or who are licensed in accordance with section one thousand seventeen of
    15  this article shall continuously provide accident insurance or such other
    16  form of financial guarantee deemed acceptable by the commission, for the
    17  protection of licensed professionals and professional wrestlers, appear-
    18  ing in authorized professional combative  sports  or  wrestling  exhibi-
    19  tions.  Such  accident  insurance  or  financial guarantee shall provide
    20  coverage to the licensed professional for: medical, surgical and  hospi-
    21  tal  care,  with  a minimum limit of fifty thousand dollars for injuries
    22  sustained while participating in any program operated under the  control
    23  of such licensed promoter and for a payment of fifty thousand dollars to
    24  the  estate  of  any  deceased athlete where such death is occasioned by
    25  injuries received in this state during the course of a program in  which
    26  such  licensed  professional or professional wrestler participated under
    27  the promotion or control of any licensed promoter; and, medical,  surgi-
    28  cal  and  hospital  care with a minimum limit of one million dollars for
    29  the treatment of a life-threatening brain injury sustained in a  program
    30  operated under the control of such licensed promoter, where an identifi-
    31  able,  causal  link  exists  between the professional licensee's partic-
    32  ipation in such program and the  life-threatening  brain  injury.

Some stakeholders in the industry have informed me that few insurers would be willing to take on the risk to provide such coverage.   I am not expert in insurance price points for combat sports but one person who is, John McCarthy, speculated that the cost of a policy that complies with New York’s legislation will run a promotion around $100,000 per event and contrasted this with other jurisdictions such as California where the insurance requirements set back promoters between $2,500 and $5,000. McCarthy stated as follows this week on his “Let’s Get it On” Podcast –

The one thing that needs to be brought out here, is this is legalized MMA in the State of New York, but there’s some additions to this…there’s not going to be small promoters doing MMA in New York, not professional, because there are regulations as far as insurance policies and stuff.  Insurance policy for one show is going to cost about $100,000.  Now the UFC can afford that, Bellator can afford that, maybe the World Series of Fighting can afford that, but nobody else can…If you’re looking in the State of California, how much is an insurance policy for a show?   The insurance policy for a show is going to be somewhere in between $2,500 and $5,000….What has been passed is great, I’m all for it, its the step in the direction but only a couple of shows are going to be able to go there.

This is not a criticism of the long overdue legislation. It is good to see government seeking to protect the athletes that put their health on the line for the entertainment of the public and potential profits of promoters.  It is simply an observation worth noting. Professional MMA will be legal in New York as soon Andrew Cuomo puts pen to paper.  From there only the big fish will get to play in the Empire State.

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Comments
  1. I don’t care small or big…. I’m just happy it’s finally happening!

  2. Dave H. says:

    What a bunch of shit! Leave it to New York to screw this up. I bet Bellator and the UFC had a lot to do with this. Eliminating the smaller markets are only going to increase their revenue. However, you restrict all of these smaller shows, good luck finding talent in New York. I guess we’ll be going to Ohio and Pennsylvania. Oh and not to mention the Indian reservations who would love to stick this up New Yorks ass!

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