Last week, an executive from a space insurance company validated that a growing stream of recent claims is mounting insurance rates and heading some insurance companies to reassess their position in the market.
A senior space underwriter at AXA XL, Dominique Rora, delivered a presentation at Euroconsult’s World Satellite Business Week, in which he mentioned that the underlying issue was not the increasing claim demands but rather the declining rates of investment plans that led to gradual downfall in the businesses of insurers in 2018 and 2019. He said that according to the analysis of space insurance data for the past few months, both the number and amount for claims are quite high. However, the key point to be noticed is that the premium trend has been declining over the past several years.
The recent claims that significantly pressurized the space insurers are the launch failure of a UAE’s Falcon Eye-1 imaging satellites-loaded Vega rocket in July 2019, for which the company has claimed $415 Million—a largest solo claim so far. WorldView-4 raised a claim of $183 Million, as the company failed to operate orbiting imaging satellite in January 2019.
Rora thoroughly analyzed the space market and noted that since 2003, the launch operations jumped by 20% till 2018. However, in the reporting period, the coverage had dropped to 5%. Such conditions have driven the space insurance market.
On a related note, besides space insurance, investment in space missions and programs is also mounting. After completion of 50 Years of first manned visit, this summer by the US astronaut Neil Armstrong on the moon, space exploration developments in Indiana has begun at a remarkable rate.
Indiana’s Purdue University, NASA, and other private space companies are working together to develop aerospace technology. Director of the American Institute of Aeronautics and Astronautics (AIAA), Dan Dumbacher, has stated that Indiana has so far invested around $900 Million in developing the aerospace industry.