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Landmark insurance payout awarded to former AFL player Shaun Smith

In a landmark decision, former AFL player Shaun Smith received an insurance payout of just over $1.4 million in compensation for mental health issues he attributes to the series of head knocks received during his football career.


During the late 80s and 90s, Smith played 109 matches for Melbourne and North Melbourne. It was an era where players were expected to continue to play after a major head knock and still be available for selection the following week. Smith suffered a series of concussions throughout his career which he believes led to the mental health issues he suffers today.

It seems that Smith’s insurance company agrees. MLC has acknowledged that the 51-year-old had suffered “total and permanent disablement (TPD)” due to brain injuries resulting from head knocks. Smith had taken out TPD insurance when he was aged 26.


Continual knocks to the head can manifest in a brain condition called chronic traumatic encephalopathy (CTE). Researchers confirmed their first CTE case in former AFL player Graham ‘Polly’ Farmer who died in 2019 after a long battle with Alzheimer’s. He was diagnosed posthumously with stage 3 CTE after tests were performed on his brain tissue. Doctors say the only known risk factor in developing the condition is from repetitive head injuries.


It’s also been confirmed that former St Kilda captain and Richmond coach Danny Frawley was suffering from CTE when he died in September 2019.


Smith fears that he has chronic traumatic encephalopathy (CTE) and has agreed to donate his brain to The Australian Sports Brain Bank for testing. He also believes that Farmer’s diagnosis is just “the tip of the iceberg”. In his opinion, Farmer’s diagnosis had been “only a matter of time” and a “wake-up call” for the AFL. Smith suggests that the AFL could now be facing a class action led by Peter Jess that includes former players John Barnes, Greg Williams as well as himself.

"I am showing all the signs of it. If I don't, I must have something really horribly wrong with my brain." – Shaun Smith

It’s not just the AFL facing potential class actions for brain injuries acquired during contact sports. In 2019, three legal firms announced plans to launch class actions against the NRL over their handling of head knocks. In a landmark Australian study, research was conducted on the brains of two former rugby league players, each who had played in excess of 150 first-grade games. They were both found to have suffered from CTE. Further, in approximately 2000 claims lodged by former NFL players over $$US500 million has been paid out so far, with the figure forecast to reach around $US1 billion over time.


The AFL have strengthened their match-day protocols regarding the management and identification of concussion, and they are continuing to change the laws of the game to discourage high contact.


But will that be enough to minimise the risk of brain injuries to their players?


Neuroscientist Dr Alan Pearce is backing calls for more action to be taken.

While we can't stop the chance of someone being concussed, what we really need to do is more research into the outcomes and how people respond and recover." – Dr Alan Pearce, Neuroscientist

Pearce believes that longer rest periods should be introduced, and that cultural change was needed.


"We need to change the culture so people are not going to say, 'I am fine, I need to go back and play, I don't want to let my team mates down' – to allow them to have healthy playing careers as well as quality of life after they retire," said Pearce.


Smith hopes that his payout – along with recognition from an insurer that concussion-related damages are real – will force the AFL to further change how it manages its players after they are concussed.

“It makes concussion real. The footy codes need to realise that if you get knocked out you can’t play next week or the week after.” – Shaun Smith

The AFL will need to address another issue that’s come to light – the fact that other players may not be entitled to payouts like Smith’s through the AFL’s major insurer, AMP. The question of financial repercussions and whether the impact of Smith’s decision will affect the cost of future insurance premiums for all contact sports has also arisen.


Concussion has been – and will be – an ongoing problem across all contact sports. Smith hopes his case will generate debate about how people damaged during their careers will be compensated in the future.


It remains to be seen whether this settlement will open the floodgates to future claims from professional players in our sporting codes and whether it will filter down into a non-professional context. In any event, it is encouraging to see sporting bodies adopting a professional response to a serious and often tragic aspect of playing contact sport.

Questions? Contact Mark Da Silva, Principal Lawyer

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