The future of college athletics in the US is at a legal and financial crossroads. As student-athletes generate increasing revenue for universities and monetize their personal brands through name, image, and likeness (NIL) agreements, longstanding assumptions about amateurism are being reexamined. Central to this evolving landscape is a key question: What would it mean—legally, financially, and institutionally—if college athletes were reclassified as employees?
This article explores the potential implications of such a shift, focusing on how employment status could reshape the insurance environment surrounding college sports. From workers’ compensation and employment practices liability (EPL) to risk management strategies and regulatory compliance, speculation surrounds what universities, policymakers, and insurers might confront in a post-amateurism model.
Monetizing the athlete: NIL’s impact
The college athletics landscape began shifting dramatically with the implementation of NIL policies in 2021. These rules allow student-athletes to earn money from their personal brands through endorsements, sponsorships, social media content, and other business opportunities without risking their eligibility with the National Collegiate Athletic Association (NCAA), which regulates student athletics in the United States.1
Although these deals are negotiated independently of universities, the rise of NIL deals underscores the growing economic role of athletes and places additional strain on the traditional amateurism model. The idea that athletes can receive six- or seven-figure endorsement income while still being classified as “amateurs” raises questions about the concept of amateurism.
Though NIL agreements alone do not confer employee status, they contribute to a broader picture in which athletes function in a quasi-professional capacity. This trend could shape future interpretations of legal obligations, compensation rights, and risk exposure.
Legal battles: NCAA v. Johnson and shifting judicial views
Several legal cases have begun to challenge the NCAA’s historical model, which treats all student-athletes as amateurs and not as employees. Among them, NCAA v. Johnson has attracted attention as a potentially significant case. Filed in 2021, the lawsuit contends that student-athletes should be classified as employees under the Fair Labor Standards Act (FLSA), making them eligible for minimum wage and other employment-related benefits.2
This case follows earlier litigation such as Berger v. NCAA (2016), in which courts sided with the NCAA in concluding that student-athletes are not employees under FLSA, citing the educational nature of student-athletics.3 However, judicial sentiment may be shifting. In NCAA v. Alston (2021), the U.S. Supreme Court unanimously found that the NCAA’s restrictions on education-related benefits breached antitrust regulations.4 The Court’s opinion expressed skepticism of the NCAA’s amateurism defense and indicated openness to reevaluating its applicability in light of the economic realities of college sports.
Most recently, in House v. NCAA, a landmark federal antitrust case approved in June 2025, the NCAA agreed to a $2.8 billion settlement and authorized revenue sharing between schools and athletes, effectively ending its longstanding prohibition on direct compensation.5 The case acknowledged that athletes had been unfairly denied earnings opportunities under prior NIL restrictions, and its resolution marks a fundamental shift in how college athletes are treated within the economic structure of collegiate sports.
Should courts begin recognizing athletes as employees, the legal foundation of amateurism would be further destabilized. Even absent definitive rulings, the growing number of legal challenges—including high-profile cases like House and Johnson—reflects mounting uncertainty around the student-athlete classification and may influence future regulatory or institutional policy changes.
Insurance and risk: Emerging employer liability
If student-athletes were to be reclassified as employees, one immediate area of impact would likely be insurance and risk management. The most direct implication would be the extension of workers’ compensation coverage to athletes. This required insurance coverage offers wage replacement, medical care, and rehabilitation services to employees who are injured while working, usually regardless of who was at fault.6
At present, medical coverage for athletic injuries varies significantly across institutions. Many universities offer secondary or supplemental insurance, and the NCAA provides catastrophic injury coverage for cases exceeding $90,000 in medical costs.7 However, these plans often exclude wage replacement and long-term care, particularly since student-athletes have not historically been compensated through wages. To illustrate potential implications, consider the hypothetical impact of a reclassification on an athlete such as Juju Watkins, a star USC basketball player who suffered a knee injury during the NCAA tournament. In the current framework, her medical expenses may be partially covered, but she is not entitled to income replacement during her recovery period. In addition, if her commercial endorsements—many tied to her on-court visibility—were suspended or reduced, she could face a loss of NIL income without legal recourse.
If classified as an employee, Watkins could qualify for workers’ compensation benefits, including wage replacement and medical coverage. However, because NIL earnings stem from third-party contracts, these would likely fall outside traditional workers’ compensation protections unless policy or legislation explicitly extended coverage to that category of loss.
In professional sports, athletes are widely recognized as employees and benefit from well-established insurance protections.8,9 For example, NFL players receive comprehensive workers’ compensation and disability coverage negotiated through their collective bargaining agreements, which include protections against career-ending injuries and wage replacement during recovery. Similarly, professional athletes have the option to purchase loss-of-value insurance policies, which can help protect against potential future income loss, particularly from contracts, due to injury or illness. These policies, although not automatically provided by the league, reflect the sophisticated risk-management infrastructure surrounding professional sports and the contractual nature of athletes' employment. College athletics, by contrast, currently lack comparable uniform coverage, underscoring the significant institutional adjustments that would be required if student-athletes were to be reclassified as employees.
These considerations are not entirely theoretical. In other areas of higher education, dual-status individuals like graduate assistants and student workers already navigate the blurred lines between student and employee. Many receive employer-sponsored health benefits, participate in workers’ compensation programs, and are covered by institutional employment policies, despite maintaining academic status. This hybrid model offers a potential framework, or at least a parallel, for how institutions might structure protections and insurance programs for student-athletes if reclassified as employees.
Over time, reclassification could lead to more expansive or customized insurance programs designed to address such gaps. Supplemental disability coverage, NIL agreement interruption insurance, or loss-of-future-earnings protections could emerge as part of a more formalized benefits framework.
Beyond injuries: Employment practices and liability exposure
Employee status could also subject universities to a broader range of legal and regulatory obligations. These include federal laws such as the Civil Rights Act, the Americans with Disabilities Act, and the Family and Medical Leave Act, as well as state labor codes. Together, these laws govern issues ranging from discrimination and harassment to leave policies and workplace accommodations.
One likely area of concern is EPL, a category of risk involving claims such as wrongful termination, retaliation, unequal treatment, or hostile work environments.10 In athletic programs, coaches wield substantial authority over scholarships, playing time, and media access—factors that could give rise to perceived or actual bias.
Gender equity, for example, could become a focal point in the NIL era if female athletes allege that they are being denied equal promotional support. Similarly, racial disparities in recruiting practices or disciplinary actions might result in disparate impact claims under employment law.
Although these scenarios remain hypothetical in the collegiate context, professional sports offer some instructive parallels. In 2018, the Dallas Mavericks were the subject of an independent investigation into workplace misconduct, leading to league-wide reforms.11 More recently, in 2023, WNBA star Dearica Hamby filed a grievance alleging pregnancy discrimination and retaliation after being traded.12 Though distinct from the college setting, this case illustrates how employment-related disputes can escalate—and how athletes are increasingly invoking labor protections to assert their rights.
Should colleges move toward an employee-based model, similar disputes could arise, especially if institutions are slow to adapt HR protocols or implement complaint resolution systems tailored to athletic environments.
To manage these risks, institutions may turn to EPL insurance. EPL coverage is designed to shield organizations from the legal and financial costs of employee-related disputes—costs that are likely to rise significantly under a model where athletes are formally recognized as employees.
Institutional shifts: Managing risk and strategy
If student-athletes were to be classified as employees, universities would likely need to overhaul how they manage athletic departments, HR, and risk portfolios. Key areas of focus would include:
- Workers’ compensation insurance for injury-related claims
- EPL insurance to address discrimination or harassment claims
- Specialty coverage for NIL-related legal exposure or reputational risk
These insurance additions would come with significant financial and administrative costs. Smaller institutions or programs outside of football and basketball might face disproportionate challenges in sustaining these expenses, with some programs facing the risk of losing funding altogether. To manage these pressures, universities could consider:
- Self-insurance programs to retain and manage risk internally
- Risk pools shared among peer institutions
- Captive insurance companies created to underwrite athletics-specific risks
At the national level, the NCAA’s existing captive insurance company could serve as a foundation for providing standardized coverage across member institutions. The captive was originally created to manage the NCAA’s event cancellation risks, which became increasingly difficult to insure affordably and reliably following the COVID-19 pandemic. Its structure allows the NCAA to directly underwrite certain risks, set aside dedicated reserves, and customize coverage to fit the unique landscape of collegiate athletics. As employment-related liabilities emerge, this entity could be adapted or expanded to offer tailored policies addressing workers' compensation, EPL claims, and other employment-specific exposures. Alternatively, a new centralized risk-management body could be established to fulfill a similar role.13,14
Governance would also need to evolve. Legal, HR, and compliance departments would need deeper integration with athletic operations. Policies related to workplace safety, injury return protocols, and employee conduct would likely require revision. NIL deal oversight, while still governed by external contracts, might need formal guardrails to prevent perceived favoritism or undue restriction.
Collectively, these changes could mark a shift from seeing athletics as an extracurricular activity to managing it as a structured employment relationship—with all the corresponding legal and operational responsibilities.
Conclusion: Speculating on a new collegiate model
As litigation, labor movements, and economic forces continue to challenge the traditional amateurism model, universities may face a future in which student-athletes are legally recognized as employees. Such a change would carry wide-ranging implications, not just in terms of compensation, but in how injuries, workplace protections, and institutional liability are managed.
From the expansion of workers’ compensation coverage to the introduction of EPL policies and revised governance protocols, universities would likely need to reimagine their risk and insurance strategies. Although the path forward remains uncertain, this possible reclassification offers a valuable lens through which to anticipate structural changes in the collegiate athletic landscape, particularly at the intersection of sports, law, and risk management.
1 Coello, S. (2025, March 24). What is NIL in college sports? How do athlete deals work? ESPN. https://www.espn.com/college-sports/story/_/id/41040485/what-nil-college-sports-how-do-athlete-deals-work.
2 Harvard Law Review. (2025, February). Johnson v. National Collegiate Athletic Ass’n: Third circuit creates test to assess college athlete employment status under the Fair Labor Standards Act. Comment on: 108F.4th 163 (3d Cir. 2024). https://harvardlawreview.org/print/vol-138/johnson-v-national-collegiate-athletic-assn-108-f-4th-163-3d-cir-2024/.
3 Edelman, M. (2016, December 23). Court decision in Berger v. NCAA creates bad case law about college athletes’ employment status. Forbes. https://www.forbes.com/sites/marcedelman/2016/12/23/court-decision-in-berger-v-ncaa-creates-bad-case-law-about-college-athletes-employment-status/.
4 Harvard Law Review. (2021, November). NCAA v. Alston. Comment on: 141S. Ct. 2141 (2021). https://harvardlawreview.org/print/vol-135/ncaa-v-alston/.
5 Murphy, D. (2025, June 6). Judge OK’s $2.8B settlement, paving way for colleges to pay athletes. ESPN. https://www.espn.com/college-sports/story/_/id/45467505/judge-grants-final-approval-house-v-ncaa-settlement.
6 Workers’ Compensation. What is Workers’ Compensation? New York State Workers’ Compensation Board. https://www.wcb.ny.gov/content/main/Workers/what-is-workers-compensation.jsp.
7 How does NIL affect college sports insurance? (2024, November 5). A-G Specialty Insurance. https://agspecialtyinsurance.com/news/ncaa-nil-policy-sports-insurance-changes/.
8 Giusti, M. (2023, October 2). How sports are insured. Insurance Thought Leadership. https://www.insurancethoughtleadership.com/commercial-lines/how-sports-are-insured.
9 Moorcraft, B. (2019, March 8). What is athlete loss-of-value insurance? Insurance Business. https://www.insurancebusinessmag.com/us/guides/what-is-athlete-lossofvalue-insurance-161625.aspx.
10 Insurance Information Institute. (n.d.). What is employment practices liability insurance (EPLI)? https://www.iii.org/article/what-employment-practices-liability-insurance-epli.
11 Cato, T. (2018, September 19) Everything the Dallas Mavericks investigation revealed about workplace misconduct. The New York Times. https://www.nytimes.com/athletic/534897/2018/09/19/everything-the-dallas-mavericks-investigation-revealed-about-workplace-misconduct/.
12 Associated Press (2025, May 15). Dearica Hamby’s suit vs. WNBA tossed; can pursue case vs. Aces. ESPN. https://www.espn.com/wnba/story/_/id/45168439/dearica-hamby-suit-vs-wnba-tossed-pursue-case-vs-aces.
13 Sports Business Journal. (2022, March 8). NCAA creating $175M self-insurance captive to cover event cancellation. https://www.sportsbusinessjournal.com/Daily/Issues/2022/03/08/Colleges/NCAA/.
14 Dodd. D. (2022, March 11). NCAA sets aside $175 million to help insure men’s basketball tournament, avoid potential shortfall. CBS Sports. https://www.cbssports.com/college-basketball/news/ncaa-sets-aside-175-million-to-help-insure-mens-basketball-tournament-avoid-potential-shortfall/.