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Yankees could receive insurance funds if Alex Rodriguez can’t play

Dec 4, 2012, 2:21 PM EDT

Alex Rodriguez AP

So, the best thing A-Rod can do for the Yankees now is not play?’s Jon Heyman reports that the Yankees have insurance on Alex Rodriguez‘s contract that would cover 75-80 percent of his salary if he proves unable to play due to injuries.

Rodriguez is currently expected to miss 4-6 months following hip surgery in January, potentially leaving him sidelined until June or July.

The way insurance on baseball contracts typically works is that it doesn’t kick in unless a player misses the entire season. Whether that’s the case here is unknown, but it’s a pretty good case there won’t be any immediate windfall for the team.

Rodriguez is signed for five more seasons at a total of $114 million. If his body continues to break down, then perhaps the Yankees will recover big portions of his salary in future years. It might also have luxury-tax ramifications. Technically, A-Rod’s salary would still count against the tax even if he were injured and insurance was covering it, but if the Yankees dropped him from the 40-man roster, it no longer would.

That’s what happened with disappointing import Kei Igawa before his contract expired. Since he was no longer on the 40-man, his salary didn’t figure in for tax purposes. However, the Yankees also couldn’t pay someone to take him — which would have had luxury tax ramifications — and they essentially held him hostage in the minors until his contract was up.

  1. ezthinking - Dec 4, 2012 at 2:31 PM

    “they essentially held him hostage in the minors until his contract was up.” You mean they forced him to play to earn some of his money rather than get paid by the Yankees to play in Japan.

    • WhyDoIActuallyCare - Dec 4, 2012 at 2:35 PM

      Beat me to it. Igawa was free to leave, but he elected to keep the money, and thus had to stay in the minors.

    • pjmarn6 - Dec 4, 2012 at 7:14 PM

      What is missing is that the Yankees knew that Rodriguez had an ailment and played him anyway. If as it appears he played hurt, he only increased the damage.

      He should have been dropped from the 25 man roster and Girardi should have put someone else in.

  2. lax12345 - Dec 4, 2012 at 2:32 PM

    Most expensive minor league player in history.

    • number42is1 - Dec 4, 2012 at 2:35 PM

      most expensive NON ROSTER player in history

  3. WhyDoIActuallyCare - Dec 4, 2012 at 2:33 PM

    For clarification, they did not hold Igawa hostage in the minors. They could mutually dissolve the contract and he would have been free to go elsewhere. Technically, he elected to stay in the minors and get tons of money.

  4. lax12345 - Dec 4, 2012 at 2:37 PM

    They will still be okay with Chavez and Nunez playing third base

    • collateral96 - Dec 5, 2012 at 1:30 AM

      They would be fine with Chavez but not Nunez. Nunez had a live bat I can’t disagree with that.This guy is a terrible defender and can never make the easy plays he just can’t do it at all it.It’s just impossible.He either throws balls into the dirt or just completely over throws the fielders.This guy was never worth keeping.

  5. fanofevilempire - Dec 4, 2012 at 2:39 PM

    because of all that friggin sex with ALL those hot babes A-rod and Jetes are breakin down……………..

    lucky sons of bitches, that’s what they are.

    • badintent - Dec 4, 2012 at 2:56 PM

      A-Rodless sent a love letter to Vanessa Kobe but she told him she already had one badknee 35 year and didn’t want to swap out a bad knee for a bad hip.

      • fanofevilempire - Dec 4, 2012 at 3:07 PM

        done in by a bad hip, tough way to go out there.

    • collateral96 - Dec 5, 2012 at 1:33 AM

      Arod had all of those health problems way before this year.The Yankees also kept using Jeter even though he was having a problem with his mobility that ankle was completely killing him the entire time and he played until his ankle shattered.That is what happened with Jeter nothing to do with him breaking down.Yankees just ran Jeter into the ground until he couldn’t play anymore.Arod has had the injury issues not Jeter so get your facts straight.

  6. psousa1 - Dec 4, 2012 at 2:43 PM

    Wow. Groundbreaking. Heyman sure does get the big scoops. Insurance on his contract like 99.99999% of all multi year contracts. Boras must have stopped feeding him info to leak. Maybe Heyman’s next scoop will be “Sources tell me Derek Jeter plans to play Shortstop for the New York Yankees next year”.

    • badintent - Dec 4, 2012 at 2:58 PM

      Look for Allstate to do a commercial with Cashmen and A-Rodless.

      I’m Scott Boras and I need Alex to make more $$ so I can get paid… whoops he dropped me just before he signed his mega deal. Dang.

      • Caught Looking - Dec 4, 2012 at 3:20 PM

        Boras would never do any commercial with ‘discount’ in any script, and certainly not a discount double check.

      • badintent - Dec 5, 2012 at 12:24 AM

        @cuaght looking

        Nice ! nod to A. Rogers

  7. raider2124 - Dec 4, 2012 at 2:44 PM

    A-rod needs to stay on the 40 man roster to collect the insurance money. Albert belle is the example. The orioles needed to keep him on the 40 man or insurance would not cover it. I also believe it needs to be a career threading injury so that a-rod would never play again.

  8. kkolchak - Dec 4, 2012 at 2:48 PM

    “If his body continues to break down, then perhaps the Yankees will recover big portions of his salary in future years.”

    Sounds like A-Rod should be watching over his shoulder for any shady thugs trying sneak up on him and take out his knees ala Nancy Kerrigan. 😀

  9. fanofevilempire - Dec 4, 2012 at 3:12 PM

    if I was Hal I would slap Hank in the head during every holiday dinner when I think about that dumb ass contract extension, imagine Texas was paying A-Rod while he was winning MVP for the empire.

    oh boy.

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