By its very definition, the impact of a pandemic is extremely pervasive.
Naturally, the most critical area it touches is individual health. But there’s a virtually endless domino effect such a scenario has on countless aspects of everyday life. As we’ve seen over the last 24 hours, that certainly includes favorite pastimes. And the money some like to stake on them.
And while it’s rightfully considered trivial to those dealing with life/death circumstances, there are potentially deep financial ramifications in the sports betting world as a result of the increasing amount of cancellations/suspensions of regular-season and tournament play.
Futures bettors left in limbo
With the immediate future of no less than the NBA regular season in question due to the coronavirus outbreak – as well as that of multiple major college basketball tournaments, including March Madness, the pause on the NHL season and the reported imminent postponement of the start of MLB campaign – the many bettors holding futures tickets for these events certainly can’t help but wonder what happens to their open wagers.
TheLines.com reached out to several major sportsbooks Thursday regarding their plan of action for these contingencies. Unsurprisingly, on a day when the cavalcade of cancellations that began with the NBA’s Wednesday night announcement of its suspension of play is still in full force, sportsbooks are still evaluating how they’ll handle the situation.
DraftKings Sportsbook was also contacted for comment, which was pending at the time of this writing.
No direct precedent for coronavirus-related disruption
The most recent and perhaps closest comparative situation – albeit on a considerably smaller scale –could be last year’s Alliance of American Football’s (AAF) truncated inaugural season.
The AAF famously and abruptly suspended operations after eight weeks last season when majority owner Tom Dundon pulled the plug. Both FanDuel and PointsBet paid out any AAF Championship futures bets that had been placed on the Orlando Apollos, since Steve Spurrier’s team had the league’s best record at the time. Tickets on all other teams were refunded.
Needless to say, AAF handle is dwarfed by that regularly seen on the games run by leagues and conferences that have paused/canceled events over the last 24 hours. Therefore, such a solution is fiscally impossible.
Sportsbooks do have general guidelines for handling what could be considered a case of “force majeure”, defined, in part, as “natural and unavoidable catastrophes that interrupt the expected course of events and restrict participants from fulfilling obligations.”
Sportsbooks could take a number of different routes
Typically, in the cases of cancellations of individual sporting events – or even a block of games such as those of the canceled NCAA tournaments – tickets, be they single-game or futures, are typically refunded since the event never transpires. The potential wiping out of a season also impacts futures bets, however, and doesn’t necessarily offer as clear of a solution.
Take the case of over/under bets on regular-season win totals for paused leagues.
Over wagers on teams that already are locked into falling short of the projected win total even if a league resumed a full schedule of play could potentially be graded as losers immediately. However, given that futures wagers are typically contingent on a full league schedule being played, sportsbooks may simply have to wait to see what transpires, as a matter of following their own terms and conditions.
And, even in the unlikely event the NBA and NHL actually complete their entire regular-season schedules in delayed fashion, operators could still opt to refund what would have been losing tickets in a nod to customer goodwill.
Naturally, the same contingency could be in play for over/under futures tickets that are technically still “alive”. While a truncated schedule would technically free sportsbooks from the obligation of paying out on an Under win total bet that hits in a shortened regular season, they may make the decision to deem such tickets winners.
It’s also important to keep in mind that bettors may not necessarily see a uniform, across-the-board response from the increasing number of regulated sportsbooks. Each operator will undoubtedly utilize individual discretion on certain decisions, depending on how circumstances with each league/event plays out.
As the rapidly unfolding chain of events stemming from the COVID-19 outbreak show, measures and solutions at the local, state and federal levels are being arrived upon in spontaneous and continuously evolving fashion.
Sportsbooks are no different when dealing with the impact on their industry, but bettors should progressively gain additional clarity on their open tickets as sports leagues eventually announce their plans of action.