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Among the numerous ways the COVID-19 crisis is different from past crises in the United States is the near full stoppage of all sports.  While we should be mere days removed from the NCAA Basketball Championship game, and an Easter weekend coupled with the Masters Golf Tournament, the sports calendar has remained mostly empty for over a month.

It is a unique component of this global pandemic, one the US has not faced even in the darkest times of our nation’s history.  In most cases, we have had sports as a welcomed respite, or at times as a patriotic boost with the ability to cross not only political party lines but the occasionally more staunch team-allegiance lines.  President Bush’s appearance to make the opening pitch at Yankee Stadium after September 11, 2001, tragedy comes to mind.

With every major professional sports league on hiatus, the summer Olympics officially postponed, and sports news dominated by announcements of the next event, each being forced to cancel or postpone.   It was within those announcements this month that an interesting revelation came to light about the 2020 Wimbledon Championships, one I saw while scrolling through my Twitter feed:

It would seem almost clairvoyant on the part of the All England Club, the members-only club that hosts the Wimbledon Championships each year, if not for the fact another major sporting event also had a similar insurance policy.  The British Open golf tournament canceled their event, and like Wimbledon1, it will be the first time since World War II it will not be held.  Other tennis and golf tournaments presumably do not have similar policies, leaving those tournaments in a predicament of deciding whether to cancel or attempt to reschedule later in the year.

In addition to the entertainment sports provide, they also teach us that, win or lose, there are lessons to be learned.  In the absence of entertainment, what lessons might we as individuals learn from the shrewd insurance and contingency planning by Wimbledon?


The world has not seen a global pandemic on the scale of COVID-19 since the Spanish Flu over 100 years ago; it was said to be the 2003 SARS outbreak, which put the risk on Wimbledon’s radar. Notably, Britain only incurred four deaths as a result of SARS, but it caused them to realize the threat of another pandemic fit squarely in the realm of a risk they should seek to transfer.

As individuals, we make these choices frequently.  We decline the “extended warranty” for a dishwasher purchase because it is a relatively low impact, low probability risk that we are willing to retain (and thus replace a lemon out of pocket if necessary).  We avoid driving the wrong way on the Interstate, knowing it is both likely to lead to an accident, and the cost is life-threatening. We put protective cases on our iPhones to reduce the likelihood of a broken screen.

But it is the last category that is most problematic, those risks we cannot (or choose not to) pay for personally, but that comes with a likelihood just high enough to result in lost sleep.  These are the risks that we protect against by choosing to transfer the risk to an insurance company.


The previous examples can seem over-simplistic, but we know in real life that the decisions become much more difficult.  Should I have collision insurance on a 20-year old vehicle?  Do I need disability insurance if I plan to retire in five years?  Is long-term care insurance worth the cost if I never use it?

To begin to get to the heart of each insurance decision, the question we ask at Bridgeworth is surprisingly simple:

Can your personal financial circumstances afford the cost of [insert risk] happening?

If that 20-year old vehicle is stolen, can you purchase a replacement out-of-pocket?  If an injury prevented you from working, can you afford to retire today instead of five years from now?  If you, or your spouse, need 24-hour healthcare, do you have the income/savings to cover that cost?

Once we have identified what is and is not a risk to your personal financial stability, we then determine if the cost to insure it is viable.

Returning to Wimbledon, their challenge was determining if a $2 million annual insurance premium was worth the cost of insuring against a pandemic that may not happen for decades.  To place their decision in context, $2 million is roughly .65% of the tournament’s projected revenue in 2020, which by comparison, it is akin to paying $2,300 annually to insure a $350,000 home or $650 to protect against a $100,000 wedding being cancellation due to “cold feet.”

Ultimately, Wimbledon decided the trade-off was sensible, paying $34 million in premiums before this year’s claim, which will net a reported $141 million.  And what about the naysayers asking, should they have opted against the insurance and invested that $2 million?  Had the All England Club dutifully invested $166,667 per month in an all-equity investment strategy (the S&P 500 index) over the past 17 years they would have been rewarded with a healthy 10.5% annualized return through year-end 2019 (assuming they remained diligent, even during the 2007-2009 financial crisis).  Unfortunately, that would have left them with a meager $86 million, $55 million short of the insurance proceeds they stand to receive.


Insurance is rife with technicalities, from actuary tables to claims data to policies seemingly as thick as a dictionary.  Still, our desire to have insurance is based on emotion, primarily the fear of loss.  A wise insurance plan aims to balance that emotion with a reasonable calculation of a potential loss.

An engagement ring can be replaced if lost or stolen, but the thought of the sentimental loss, coupled with the financial loss, often causes us to insure it.  A retiree may not “need” life insurance, but the comfort it provides to a survivor can be priceless.  The cost of long-term care health expenses could be paid from investment assets, but would children feel they must choose between caring for a parent and spending their inheritance?

Reportedly even Wimbledon considered an emotionally based cancellation risk.  What if the Queen passed away, the UK was in national mourning, and it happened to coincide with the tournament forcing a cancellation?  Best to sing “God Save the Queen” but also consider insurance if by chance He doesn’t…

In a time where risk has presented itself in ways, most we previously could not have envisioned, from eating in a restaurant to attending a church service, reconsider your personal non-pandemic risks.  If you need help determining the potential impact of those risks, I encourage you to reach out to a Bridgeworth advisor to help you analyze your exposure and insurance needs in a variety of areas using our advanced software and an objective, conflict-free methodology.


1 https://www.usatoday.com/story/sports/tennis/2020/04/09/wimbledon-pandemic-insurance-policy-payout-141-million/5123987002/

2  The calculation assumes a $166,667 monthly investment from March 2003 through December 2019 in the S&P 500 index. Investment fees and capital gains tax are excluded.


This material is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. The opinions expressed are as of April 15, 2020, and may change as subsequent conditions vary. The information and opinions contained in this material are derived from proprietary and nonproprietary sources deemed by Bridgeworth, LLC to be reliable, are not necessarily all-inclusive and are not guaranteed as to accuracy. Past performance is no guarantee of future results. There is no guarantee that any forecasts made will come to pass. Reliance upon information in this material is at the sole discretion of the reader. Investing in stock includes numerous specific risks, including the fluctuation of dividends, loss of principal, and potential liquidity of the investment in a falling market. Any securities, indices, and other financial benchmarks shown are provided for illustrative purposes only and reflect the reinvestment of income, dividends, and other earnings. They do not reflect the deduction of advisory fees. Investment products are subject to investment risk, including possible loss of the principal amount invested. You cannot invest directly in an index. The Standard & Poor’s 500 Index is a capitalization-weighted index of 500 stocks designed to measure the performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.

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