Kalshi enters $9B sports insurance market with new brokerage deal
Kalshi is moving deeper into the sports insurance market after announcing a partnership with sports insurance broker Game Point Capital, according to comments from CEO Tarek Mansour.
- Kalshi has partnered with Game Point Capital to expand into the $9 billion sports insurance and reinsurance market, which is projected to double by 2030.
- Game Point executed two basketball bonus hedges on Kalshi at significantly lower prices (6% and 2%) compared to traditional OTC reinsurance rates of 12–13% and 7–8%.
- Kalshi is positioning its exchange as a cheaper, more transparent alternative to traditional reinsurers like Lloyd’s of London, citing growing liquidity and institutional capacity.
The collaboration targets the fast-growing sports insurance and reinsurance industry, currently valued at around $9 billion annually and projected to double by 2030.
The market covers a range of risks, including brand sponsorship guarantees, game cancellations, player compensation structures, and performance-based bonuses.
Game Point Capital issues hundreds of millions of dollars in sports insurance each year. One of its most in-demand products is team and player performance bonus insurance, which protects teams against large payouts triggered by milestones such as playoff appearances, championship wins, or statistical achievements.
Kalshi undercuts traditional reinsurance pricing
Last week, Game Point executed two basketball-related performance bonus hedges on Kalshi’s exchange. One contract covered a bonus tied to a team making the postseason, priced at 6% on Kalshi compared with roughly 12–13% in the over-the-counter (OTC) market.
Another hedge, linked to advancing to the second round, was priced at 2% on Kalshi versus approximately 7–8% OTC.
Traditionally, insurers seeking to offload risk negotiate directly with reinsurance providers such as Lloyd’s of London. These OTC arrangements often involve bilateral negotiations, limited transparency, and higher pricing, particularly for volatile or higher-risk contracts.
Mansour argued that exchanges offer a competitive alternative by expanding liquidity and allowing multiple counterparties to bid in an open market, improving price discovery and lowering costs.
Kalshi’s pitch hinges on liquidity. During the recent Super Bowl, the exchange could have processed a $22 million trade without significantly moving market prices, according to the CEO.
With that depth, Kalshi expects to handle tens of millions of dollars in similar hedging transactions from Game Point in the coming months, positioning prediction markets as an emerging tool in institutional sports risk management.
