United States Department of Transportation
i
Update of the space and launch insurance industry : Quarterly Launch Report : special report
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1998-01-01
[PDF-109.43 KB]
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Abstract:Insurance is a basic requirement for the maintenance of a commercial space industry. Space activity mishaps can result in hundreds of millions of dollars of expenses. Two recent launch vehicles that failed (a Titan 4A and the initial Delta 3) were valued at $1.3 billion and $225 million respectively (inclusive of payload). The replacement cost of the recently failed Galaxy 4 satellite, for
example, was in the range of $200 to $250 million. In addition, consequences of mishaps will typically extend beyond the cost of a satellite and launch vehicle. Business operations can be delayed, possibly resulting in the deferral of a satellite venture?s vital
revenue streams. With such valuable assets at risk, insurance is essential to mitigate the high cost of a failure. Certain types of space insurance, such as third party liability insurance, protect the
general public from the hazards of space activity. The U.S. Federal Aviation Administration, through the Commercial Space Launch Act Amendments of 1988, requires third party liability insurance as a
condition for the issuance of a commercial launch license. Under the 1972 United Nations Convention on International Liability for Damage Caused by Space Objects, governments are liable for injury or damage
to third parties, caused by launch vehicles or payloads launched under their jurisdiction.
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