In the grand scheme of all the things out there to gamble on, betting on old people dying doesn’t seem like a particularly bad idea. Horribly morbid? Sure. Morally questionable? No doubt. But a bad idea? Not especially.
As it turns out, though, not even death is a sure thing.
That’s the lesson Oklahoma State University (OSU) learned the hard way recently when it bet on some of its boosters -- ranging in age from 65 to 85 -- dying off sooner rather than later.
As reported by Courthouse News (via Deadspin), back in 2007 OSU launched a program called ”Gift of a Lifetime” where they took out hefty life insurance policies on some of the school’s “top” boosters. Per the plan, OSU named itself as the beneficiary in each case and stood to profit handsomely when it was all said and done. Because the school anticipated revenues of up to $350 million when everyone died off, it eagerly agreed to pay the annual premiums for the participating parties.
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Hard as it may be to believe, betting on old people dying didn’t end well. Via Courthouse News:
After Cowboy Athletics paid the $16 million annual premium on each covered booster for two years, and none of the boosters had died, university president Burns Hargis asked for copies of the policy in January 2009. Within 10 days of physically receiving the policies, the school tried to cancel the policies under free-look provisions in state law. It asked for a refund of premiums paid, arguing that the insurer failed to provide copies of the policies until 2009.
In other words, OSU tried get a refund of $33 million on a bet they made that old boosters would die within two years of the school beginning to pay their life insurance premiums. And not only did the school try to get a refund, it went so far as to sue the insurance company to do it.
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This past Thursday, a judge who looked into the matter ruled that OSU would not get a refund on its bad bet. The judge also found that OSU was liable for all court fees and expenses suffered by the insurance company as a result of the lawsuit.
The lesson in all this? Presumably something about not betting on elderly people dying.