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Baseball Primer Newsblog — The Best News Links from the Baseball Newsstand Monday, December 26, 2022Mets, Carlos Correa optimistic deal will work out after concernsWith a second questionable physical, I’m not sure Boras and Correa have many options for a long-term deal in this price range. Sure, they can pivot to a short-term, high AAV deal but I suspect they’d rather have a longer deal with some injury protection for the Mets baked in.
jimfurtado
Posted: December 26, 2022 at 11:38 AM | 19 comment(s)
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1. Walt Davis Posted: December 26, 2022 at 01:14 PM (#6110917)Still, if I'm the Mets, of course I take advantage of this to shave $50 M off the deal or put in some vesting options or ... We could possibly see something like Magglio Ordonez's deal with Detroit. I forget the specifics but Detroit could get out of the deal if he had a serious injury to his left knee (or whichever part it was). He might end up back with the Twins yet. Or with the Dodgers.
I can see why the Twins had no issue. A couple year contract. But signing up for ten years - that's a harder putt.
Still, he can bet on himself by absorbing the risk of something goes wrong - or he can go year to year at higher values (for now )
That's not the riskiest part of the deal. It's the most painful part and understandably an underwriter wants no part of it. But the big risk is that Correa will miss a ton of time during the first 5-6 years which is when he's expected to produce 20-30 WAR. If the Mets can get insurance on the first 5 years (or years 2-6 or whatever) then that's fine.
But if Cohen is willing to spend this crazily and toss $100 M into the CBT kitty then he might be happy and able to self-insure.
Well, 8-year-olds shouldn't be playing big league baseball in the first place! No wonder they're getting hurt...!
You'd think, but that's generally not how large corporations work. They still buy insurance or reinsurance against relatively modest losses all the time.
Having represented several large corporations, what I have seen is a lot of self-insurance, with a major insurer acting in a claims manager role. There may be "reinsurance" for truly large risks, but they see the cost-benefit of self-insurance running in their favor.
But they also buy a lot of insurance they don't really need. Every Fortune 500 could self-insure all their vehicles and employee health insurance, but many do not. Life Insurers and Reinsurers often cap their exposure on a single life to $10M or less, even though they have billions of dollars in reserves. There's a lot of sub-optimal risk aversion in the world.
Mets Rumors: Carlos Correa's Contract to Be 'Dramatically Different' If He Signs
"Will he be a happy Met?" Well, he hasn't inked anything yet, so if he feels he's going to be unhappy with the organization before he even dons a uniform, there's plenty of other teams he can sign with, and avoid said unhappiness...
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