Insurance coverage on the final frontier: Space tourism a giant leap for insurers
Brokers and other observers said it is difficult to speculate on the insurance market for private space flight because the space tourism industry is not yet a reality, but some said they believe the initial ventures would have difficulty buying cover for the risk.
â€œI imagine at first what you’re probably going to see is a limited amount of insurance capacity to purchase on an asset and liability basis,â€ said Jeffrey Poliseno, chief executive officer of International Space Brokers Inc., a Rosslyn, Va.-based division of Aon Risk Services. â€œYou’ll have a few (underwriters) in the beginning willing to take on more risk (on space tourism) than others, but they’ll price accordingly.â€
One aerospace underwriter agreed, saying the history of private companies attempting to launch satellites suggests insurers could expect space tourism to produce at least one loss in its early stages.
â€œThere are going to be very few markets willing to write that business,â€ the underwriter said. â€œYou’re talking about people being placed on top of vehicles that are going to fail…It’s a very volatile area.â€
Mr. Poliseno said space tourism presents a risk too different from satellite launches to compare the two. But he said he thought space tourism underwriters would want to see extensive test flights and demonstrations of reliability before putting capital at risk.
Read the full story.