Deshaun Watson’s $230 million contract restructuring in 2023 may be the one thing ensuring that what was viewed as one of the NFL’s worst contracts doesn’t look quite as bad now. The Browns’ QB’s ‘insurance addendum’ became increasingly relevant for the franchise as Watson suffered multiple significant injuries and missed 38 games across three seasons. It can now help them get nearly 40% of that money in insurance cap credits. 

After teasing the report before the holiday weekend, Mike Florio of Pro Football Talk dug into Watson’s fully guaranteed deal, and his findings didn’t take long to go viral on a slow July Monday.

Florio broke down the NFLPA records and noted that the Browns will receive $8.79 million in 2024, $16.773 million in 2025, $21.724 million in 2026, $16.773 million in 2027, $16.738 million in 2028, and $7.983 million in 2029. Florio noted that the structured cap credits from 2024 through 2029 add up to nearly $89 million. 

“That’s a total in cap credit for 2024 through 2029 of $88.781 million,” Florio wrote. “Which also reflects, presumably, the insurance benefits received by the Browns on Watson’s five-year, $230 million deal.” 

In 2024, a former Packers VP elaborated on the thought process behind taking out insurance on players. 

“Teams will do big contracts with players,” Andrew Brandt explained in an episode of Yahoo Finance Sport Report. “They will then enter in insurance agreements for the player being the beneficiary. But the player signs off that the return would go back to the team and that the team would get cap credit for any return premiums.”

This is exactly what has happened with Watson and the Browns: the series of injuries Watson suffered from the first day of the 2023 offseason program to the beginning of the 2024 offseason program and from the start of the 2024 offseason program to the start of the 2025 offseason program has helped the Browns in retrospect.

When Watson returned under center in 2023, he played 6 games, passing for 1,115 yards and seven touchdowns. In what was his sixth start of the season in Week 10, Watson experienced discomfort in his throwing shoulder against the Ravens. Though he finished the game on a high with a game-winning drive to get within field goal range with under 30 seconds left, he was ruled out for the season. 

The QB returned for the 2024 season opener against the Cowboys. Seven games later, he suffered a non-contact Achilles injury on 2nd and 6 at the Cincinnati 21 with his side trailing 7-0 with 1:26 left in the second quarter. He was to return in 2025, but mere days into the calendar year, it was discovered that he had re-ruptured his Achilles, leading to surgery on January 9, 2025. 

It’s not like the Browns won’t be paying the $230M guaranteed contract money to Watson. AtoZ Sports’ Brandon Little made the calculations and revealed that the Browns will effectively pay the quarterback about $141.21M. Of course, it’s still a boatload of money. But the insurance returns made the blow significantly softer on the franchise. 

But not everyone looked at the numbers the same way Florio did. Jason Fitzgerald, the founder of Over The Cap and a leading authority on NFL contracts, replied to PFT’s post on X to debunk the math. 

NFL salary cap expert offered clarification on Deshaun Watson and the Browns’ money matters

“You are not interpreting the numbers correctly,” Fitzgerald wrote. “The numbers are what remains of the cap value from the original bonuses. The $8.79M reflects revaluing the bonus after the refund is received; it’s not the refund itself. Teams also receive credits in their adjustments for prior years.” 

Fitzgerald clarified that the numbers Florio found in the NFLPA records actually represent the adjusted cap hit after the refund was removed. When an insurance policy pays out, the original signing bonus cap charge is reduced. So, the numbers Florio cited are not the actual pile of money that the franchise got back. 

Under the NFL CBA, if a team receives an insurance payout for games a player missed in a previous season, the league applies that money as a ‘Prior Year Adjustment’ for the following season. In short, the actual insurance refund doesn’t really cancel out Deshaun Watson’s future contract line by line. Instead, it’s readjusted as credit for the next season. 

Nevertheless, Watson’s contract will continue to impact Cleveland’s salary cap. But the front office’s decision to insure the deal has at least salvaged some crucial cap flexibility for the team’s future.

Now that he’s ready to bounce back from injury and has impressed the big guns at the training camps, all we need to see is whether he can stay healthy throughout the season so as not to incur any further installments on the Insurance Addendum.