Confirmed with Link: Nathan Horton to Toronto for David Clarkson

[NotWendell]

It's not like our front office could just walk down the street and talk to some experts on insurance and risk assessment... oh... wait!

 

[Peasy]

Wanna bet? Why else would they have made the move they did. It only makes sense if they plan on being a cap team so they can LTIR Horton. If not, they are exactly in the same spot as before, only without any on ice production. Ironically its the exact spot all the people supporting the move are slobbering all over themselves about from the CBJ POV.

Right now, they are going pretty full rebuild (finally). They finally started dumping their UFA's before the trade deadline, something they have done in years, and there are multiple rumours surrounding Bozak, Lupul, Kessel, Phaneuf etc, the list goes on. From this trade the leafs would have possibly been able to keep Franson, but theyve finally realized its time to move on. Although they may no need this cap space for the next 1,2 or 3 years, they may possibly need it in years 4 or 5. Its much better to pull the trigger than to regret it later on.

 

[BluejacketNut]

It's not like our front office could just walk down the street and talk to some experts on insurance and risk assessment... oh... wait!

Its the ultimate irony, not only is the arena sponsored by Nationwide, but theyre the main corporate partner

 

[JacketsDavid]

Can anyone give me a quick explanation of what is the benefit to Toronto in this trade? Please avoid sarcasm, lol. I have a friend asking for a simple explanation of the thinking from the Leafs' perspective. Thanks.

My assessment is this. Columbus is (relatively speaking) a cash poor team. They have a budget with an upper limit of the salary cap.
Toronto has lots of cash - so they in likelihood could afford a $85M payroll if they could twist the cap around enough.

Toronto is rebuilding and stockpiling a lot of picks but had an untradeable contract, that due to it's structure (all guaranteed bonuses) that they could not buy out. But Toronto found the perfect storm (Columbus) with a similar contact, no insurance and a cash poor team.

In 2015-16 it likely doesn't help Toronto maybe not even in 2016-17, but at some point they will spend up to and above the cap, and then they will get the Cap Exception due to the injury - so if the cap is $70M, they will be able to spend $75M and LTIR Horton.

Toronto has lots of cash, paying $5.4M is not their issue their issue was having a very unproductive player making $5.4M. They would rather pay the cash and get the right players.

Columbus would rather have the a guy skating who is vastly overpaid for 5 years, than a guy sitting in the stands.

 

[Cyclones Rock]

The FO is insistent of "using its CBA leverage" with Johansen and then opens the vault for an RFA of Cam Atkinson's caliber.

No insurance, Wiz trade and this. Wow. Doug Maclean on acid couldn't out do this FO.

 

[SuperGenius]

The FO is insistent of "using its CBA leverage" with Johansen and then opens the vault for an RFA of Cam Atkinson's caliber.

No insurance, Wiz trade and this. Wow. Doug Maclean on acid couldn't out do this FO.

You keep bringing up the insurance thing like you know exactly what happened. You don't. Wouldn't it be smart to limit the raving to what actually deserves it?

As far as opening the vault, I don't see it like that at all. The deals are similar in AAV, for sure, and it was seemingly easier to sign Cam, but how do you know Joey wasn't looking for 18-20M or longer term, less term? It seems to me to be a much different negoitation and it would be foolish to compare them, IMO.

 

[DarkandStormy]

You keep bringing up the insurance thing like you know exactly what happened. You don't. Wouldn't it be smart to limit the raving to what actually deserves it?

They opted not to insure Horton in year 1 thinking he wouldn't need it until year 2 because of his "pre-existing" shoulder injury. Then he comes into year with a bad back. Can't insure that at start of year 2. Dumb gamble. They already pay into league insurance program that would have covered him had they elected everything but his shoulder in year 1.

 

[SuperGenius]

They opted not to insure Horton in year 1 thinking he wouldn't need it until year 2 because of his "pre-existing" shoulder injury. Then he comes into year with a bad back. Can't insure that at start of year 2. Dumb gamble. They already pay into league insurance program that would have covered him had they elected everything but his shoulder in year 1.

You forgot to add "I think this is what happened".

Let's pretend we were in the room. Given your situation, isn't it possible that the deductible to insure Horton for the rest of the season was more than actually paying him the rest of the season? It seems reasonable to think that an offseason 'injury' would not be something the CBJ should even be responsible for in the interim until the next season. It's entirely possible that the classification of Horton's back as a condition and not an injury kept this from being the case, and therefore led to him being uninsurable for the following season (as well as giving CBJ no leverage to fight this as an off-season injury). A gamble? Sure, I guess, but that's what insurance is: a gamble.

Of course, I wasn't there either, so I have no idea what's going on. I guess I think we should be considering the jury as still out on this rather than being so willing to throw the entire organization under the bus. It's (not) surprising to me that people are more willing to believe something they read on the internet over any suggestion that these guys know what they're doing...but...wow.

 

[DarkandStormy]

You forgot to add "I think this is what happened".

This is what is reported to have happened.

 

[SuperGenius]

This is what is reported to have happened.

Ok, this is what "they" think happened.

You get my point, however. Sorry to all to go OT a bit, but when it comes up every 3rd post it's difficult to without comment.

 

[Forepar]

You forgot to add "I think this is what happened".

Let's pretend we were in the room. Given your situation, isn't it possible that the deductible to insure Horton for the rest of the season was more than actually paying him the rest of the season? It seems reasonable to think that an offseason 'injury' would not be something the CBJ should even be responsible for in the interim until the next season. It's entirely possible that the classification of Horton's back as a condition and not an injury kept this from being the case, and therefore led to him being uninsurable for the following season (as well as giving CBJ no leverage to fight this as an off-season injury). A gamble? Sure, I guess, but that's what insurance is: a gamble.

Of course, I wasn't there either, so I have no idea what's going on. I guess I think we should be considering the jury as still out on this rather than being so willing to throw the entire organization under the bus. It's (not) surprising to me that people are more willing to believe something they read on the internet over any suggestion that these guys know what they're doing...but...wow.

At least here's my understanding of the way insurance works, the article is dated so some of the info may no longer be accurate, but the concept of only practically being able to insure 7 or so players is still in play:


http://insurancenewsnet.com/article....7b000000c1027a

http://web.archive.org/web/200809140...213270-p2.html

Teams are required to insure a handful of players through a "temporary total disability" program administered by the league. That program has been in place for about 15 years, NHL deputy commissioner Bill Daly said, and is designed to make coverage more easily available to teams.

"It provides the underwriters with 'scale,' spreads the risk and allows them to provide more favorable rates," Daly said in an e-mail.

The league purchases its disability insurance through the BWD Group, a Long Island, N.Y., insurance broker that also obtains coverage for the NBA, WNBA and Major League Baseball. (One underwriter, the Chubb Corporation, touted its relationship with the NHL in its 2001 annual report.)

Each team pays a premium based on the salaries of its five highest-paid players, but is free to allocate that coverage how it wishes. Typically, a team will extend coverage to as many as seven players, Daly said. Coverage kicks in when a player misses at least 30 games.

Beyond that, individual teams are free to pursue additional coverage, but the heavy premiums make it a losing proposition. To insure a player under the league program, it costs about 5 percent of his salary. To insure additional players, it would cost substantially more.

"Usually it works out that we have five players under the league program," Rutherford said. "When you get to a certain dollar amount, the premiums keep skyrocketing. I wish it was easier to get each [player] insured, but we can't do that. "If you wanted, you could insure all the contracts, but it would be very expensive.".


Who knows who the CBJ insured and who it didn't insure (other than they didn't insure Horton). Allocated insurance coverage to other players for 2013-14 (duh), since Horton couldn't play at all. By the time they get to 2014-15, Horton has developed a back injury that is now in essence a "pre-existing" condition that isn't insurable. Seems pretty clear that NHL teams do NOT insure every contract, and that omitting Horton for 2013-14 was a calculated decision.
CBJ had to choose among Bob, Dubi, Foligno, Wiz, JJ, AA, Tyutin, Umberger, Horton and/or others (pick your higher salaried players at the time), and factor in the risks. We might be surprised at who is insured and who isn't, even now. In hindsight, CBJ chose wrong, but that's only a function of who went down, when, and with what injury.

 

[Cyclones Rock]

You keep bringing up the insurance thing like you know exactly what happened. You don't. Wouldn't it be smart to limit the raving to what actually deserves it?

As far as opening the vault, I don't see it like that at all. The deals are similar in AAV, for sure, and it was seemingly easier to sign Cam, but how do you know Joey wasn't looking for 18-20M or longer term, less term? It seems to me to be a much different negoitation and it would be foolish to compare them, IMO.

The apologists for the ineptitude of the front office on the Horton deal astound me.

You seem to be implying that the FO had some bad luck on the situation, that's all

If you think that the FO handled the Johansen negotiation well, then I don't know what to say.

Keep the justifications for JK and JD going. You amuse me. Thanks.

 

[Forepar]

In other words, FO wasn't cheap; they had to choose how to allocate the coverage across the team. They are forced to gamble given the structure of the NHL's Disability Insurance program, or spend outrageous additional premiums beyond NHL base coverage that Toronto might do, but CBJ can't afford.

 

[Cyclones Rock]

At least here's my understanding of the way insurance works, the article is dated so some of the info may no longer be accurate, but the concept of only practically being able to insure 7 or so players is still in play:


http://insurancenewsnet.com/article....7b000000c1027a

http://web.archive.org/web/200809140...213270-p2.html

Teams are required to insure a handful of players through a "temporary total disability" program administered by the league. That program has been in place for about 15 years, NHL deputy commissioner Bill Daly said, and is designed to make coverage more easily available to teams.

"It provides the underwriters with 'scale,' spreads the risk and allows them to provide more favorable rates," Daly said in an e-mail.

The league purchases its disability insurance through the BWD Group, a Long Island, N.Y., insurance broker that also obtains coverage for the NBA, WNBA and Major League Baseball. (One underwriter, the Chubb Corporation, touted its relationship with the NHL in its 2001 annual report.)

Each team pays a premium based on the salaries of its five highest-paid players, but is free to allocate that coverage how it wishes. Typically, a team will extend coverage to as many as seven players, Daly said. Coverage kicks in when a player misses at least 30 games.

Beyond that, individual teams are free to pursue additional coverage, but the heavy premiums make it a losing proposition. To insure a player under the league program, it costs about 5 percent of his salary. To insure additional players, it would cost substantially more.

"Usually it works out that we have five players under the league program," Rutherford said. "When you get to a certain dollar amount, the premiums keep skyrocketing. I wish it was easier to get each [player] insured, but we can't do that. "If you wanted, you could insure all the contracts, but it would be very expensive.".


Who knows who the CBJ insured and who it didn't insure (other than they didn't insure Horton). Allocated insurance coverage to other players for 2013-14 (duh), since Horton couldn't play at all. By the time they get to 2014-15, Horton has developed a back injury that is now in essence a "pre-existing" condition that isn't insurable. Seems pretty clear that NHL teams do NOT insure every contract, and that omitting Horton for 2013-14 was a calculated decision.
CBJ had to choose among Bob, Dubi, Foligno, Wiz, JJ, AA, Tyutin, Umberger, Horton and/or others (pick your higher salaried players at the time), and factor in the risks. We might be surprised at who is insured and who isn't, even now. In hindsight, CBJ chose wrong, but that's only a function of who went down, when, and with what injury.

Look at the aggregate value of each of these contracted players at the beginning of the 2013-14 season. Bob approx 10m, Dubi less than 10m, Foligno less than 10m, Tyutin $15m, AA less than $10m, Umberger $15m, JJ $15-20 million. Horton $40 million.

The purpose of many types of insurance is to minimize the exposure for catastrophic loss. Horton's contract had by far the most exposure. The FO screwed up bad.

You can't justify their negligence no matter how hard you try.

 

[Cyclones Rock]

In other words, FO wasn't cheap; they had to choose how to allocate the coverage across the team. They are forced to gamble given the structure of the NHL's Disability Insurance program, or spend outrageous additional premiums beyond NHL base coverage that Toronto might do, but CBJ can't afford.

Can't afford 5% of their most expensive contract?

Then the ownership is ridiculously undercapitilized and should sell.

 

[SuperGenius]

The apologists for the ineptitude of the front office on the Horton deal astound me.

You seem to be implying that the FO had some bad luck on the situation, that's all

If you think that the FO handled the Johansen negotiation well, then I don't know what to say.

Keep the justifications for JK and JD going. You amuse me. Thanks.

I'm not apologizing for anything or anyone. What I'm suggesting is that the full story hasn't been told. I think it's silly to pretend to know everything about this situation. It's even more foolish to continue to berate the FO based on what (very little) we know, or in this case, you know.

I'm going to further bet that the people in charge of this have a little more skin in the game and motivation to get it right than some 'fan' on a message board who thinks he knows exactly what happened because he read it on the internet.

I don't know how they handled the Joey deal other than I know he signed for fair money and it got done before the season. I'm not in the room on either side, so I don't have any idea what happened. I have this funny thing about me that keeps me from criticizing others in situations when I don't feel like I have all of the information. It's probably one of the reasons I hate message boards and wish I wasn't here half the time. Places like these are full of posturing blowhards who have 5 pairs of khakis and think they know how to run a hockey organization based on what they 'hear' or play/coach the game based on what they 'see'. If people were such experts, then you'd think they'd be in the biz.

I'm all for fun discussion, which is the half that keeps me here, but this kind of crap is just too much sometimes, IMO.

 

[SuperGenius]

You can't justify their negligence no matter how hard you try.

And you cannot prove negligence because you don't know what you're talking about. None of us do.

 

[Crede777]

And you cannot prove negligence because you don't know what you're talking about. None of us do.

Doesn't it seem, though, that JD and JK identify "their guys" and stick by their guys to a fault whereas they also move "not their guys" almost to a fault?

Gaborik was open to re-signing but he wasn't "their guy" so they dropped him for essentially nothing. Wiz wasn't their guy so they traded him away for a far less return than other defensemen got. Mackenzie wasn't really their guy so they let him walk over $500,000 AAV. Johansen didn't seem to be their guy so they drug out contract negotiations.

Meanwhile guys like Tropp and Boll inexplicably seem to have free reign. Also they seem to covet players from either European clubs they've worked with or from the St. Louis Blues organization while they were there.

 

[SuperGenius]

Doesn't it seem, though, that JD and JK identify "their guys" and stick by their guys to a fault whereas they also move "not their guys" almost to a fault?

No idea on that theory. I was strictly referring to the insurance 'scandal'

 

[Forepar]

Can't afford 5% of their most expensive contract?

Then the ownership is ridiculously undercapitilized and should sell.

It is not a question of affording. The deal is that under the NHL program, they pay 5% of their 5 largest contracts for the insurance, regardless of how they allocate the coverage - most teams insure 7 contracts or so, which means something isn't covered.

The other factor I can't find is the maximum term of contract insurable. Was 7 years, but most of what I remember (and what i can find to confirm is only speculation) is that the max term insurable is now 5 years - part of the 2012 CBA. So Horton's max insurance coverage is not $40M , but closer to $25M (and multiplied by 80%, as would be the % of all the contract figures you cited in a prior post).

You (and I) might have insured the biggest contract, at face value. However, if Horton was uninsurable 2013-14 (the shoulder may have caused him to be completely exempted, or it may have simply been any shoulder injury was excluded and the CBJ takes the risk of some other career-ending condition occuring between Horton's return to the ice and the beginning of the 14-15 season, and if $25M x 80% was cap on insurance applicable, then there there is some rationale for allocating the insurance to other contracts. Maybe not what you would do, or I would do, but not negligence.

 

[BluejacketNut]

The whole difficulty understanding the insurance aspect is what makes the 7 years look ridiculous. If there were issues about costs and such then the term should have been kept at around 3 years for Horton. It wasnt like Horton was known for his dependability, he missed almost 2 full seasons in 9 years due to injuries. Now the replacement to that position is Clarkson at the same cost. Ugh

 

[JacketsDavid]

Let's be clear on the insurance - the CBJ opted to not do it for whatever reason. Right or wrong it happened. people and companies take that risk everyday (self insure, under insure, etc). If you can afford to do it's that's fine.
My issue was they didn't and then instead of being "Big Boys" and taking their medicine we start hearing stories about how "poor wittle Columbus can't afford to have Horton not playing and getting paid" - oh how sad, just breaks my heart. Then they turn around and to "fix" that they take on (arguably) the worst contract in the NHL for another 5 seasons.
So call it what you want to call it - but it's a terrible business decision to not insure the contract (especially with his history of injuries) just based on length and dollars and a worse decision to then take on the worst contract in the league. Maybe others can justify it in their minds - I can't.

 

[Tulipunaruusu*]

Did I get right... if Horton had been insured at that time would 20 percent of his salary + whatever it would have cost to insure him in the first place still be owed to him? That would be some money to pay for someone who likely won't ever again play.

But then again it is good to remember that you don't just have a chance to attract these gaboriks & hortons if they aren't about to arrive with question marks on them. They have other options too.

Bricks are bricks and boys will be boys but as a piece in the puzzle Clarkson might eventually fit better than skill set Horton displayed in his later career.

Transformation into rugged yet skilled, operative top-9 strike bunch is progressing nicely with additions of Clarkson and Karlsson. Apart the cap hits added it's still like acquiring recently in demand free agent. Hoping it works. Like always.

 

[EspenK]

To me this insurance squabble all comes down to one thing. If you can insure the entire term upfront they screwed up. If its a year by year thing then there is more justification for not insuring him the first year and 2nd year and beyond was just bad luck. Until we know that for sure I'll reserve my final judgement.

Given the situation and the fact they were on the hook for the $ it made sense to do a deal like they did. Whether Clarkson was the best choice time will tell.

 

[KallioWeHardlyKnewYe]

No idea on that theory. I was strictly referring to the insurance 'scandal'

If your standard is us "not being in the room," then that's going to wipe out a lot of discussion around these parts.