If i understand this correctly, if a team has an insurance policy on a player and they get a payout, that player effectively counts at a lower cap number the following year. So I guess this is another way that spending more cash gives you an advantage.
Same net effect but the mechanics are the opposite. The cap credit happens the year after the claim is paid, and the player's salary would be normal per the contract.
Take Desean Watson using sample numbers. Watson's 2024 salary was $50M. Cleveland ends 2024 with $10M unspent cap space, so that rolls over to 2025. 2025 cap is $275M. So Cleveland now has $285M cap space. But then the insurance pays out $35Mfor Watson's missed games and that's credited back to 2025. So Cleveland now has $320M in cap space, and Watson's 2025 cap number is still the original $75M.
Pedantic! Thanks though. I am finally trying to understand the nfl cap in a practical sense. I know a fair amount about the nba salary cap, but the nfl seems much more complicated.
Another question: after a team spreads out a cap hit over multiple years, are they allowed to roll it back up? Like if they have a year where it’s just not going to happen, can they “unspread” the hit and take their medicine that way?
There are definitely some ways they can do it (with caveats like losing the player). But I don't think I've ever seen it done.
So say you have a player who you gave a $10m signing bonus over 5 years. $2m hit the cap this year, and each year of the next 4 years another $2m will hit it to a total of $8m. And now you want to escalate it forward at some point.
First, you could release the player. This would cause all $8m of the future money to immediately hit your cap... or you could designate him as a post-June 1 release which would split the cap hit over this year and next. So of the remaining $8m, $4m this year, and $4m next year. It used to be you had to wait until June 1 to get that splitting benefit. More recently the NFL lets teams each year designate 2 players they release to work the same as a post-June 1 cut even if released earlier. Which benefits players being able to go find new teams before they have all finalized their rosters, so players are in favor of that provision.
Second, you could trade the player. The $8m in future money would immediately hit your cap. Any unpaid other money to him (like his weekly salary checks) would be paid by the other team, but prorated money stays with you. There is no equivalent to the post-June 1 designation when it comes to trading though. And of course, there is a trade deadline so you couldn't do it late in the season.
Third, and I'm not 100% positive, but think this is correct, you could restructure him and have him pay back the signing bonus and convert it to salary or a roster bonus in the present year. I've not heard that you can't do this, but it's not a topic I've seen addressed. But I believe you can only do one contract change a year with a player. So if you gave him the fresh contract, restructured or extended this year, then you couldn't come back late in the season and redo his contract again. If that was the case, next year you could roll up the 4/5 of the signing bonus in that fashion in a restructure. But I've never heard of this being done, and indeed there might be some fine print that precludes it. Just never heard of it if so.
