Space rockets and satellites are likely to cost more to insure after the European Vega rocket crash this month, which hit insurers with a record space market loss of 369 million euros ($411.21 million), insurance industry sources say.
The Vega rocket carrying a military observation satellite for the United Arab Emirates veered off course shortly after take-off and crashed.
Prior to the accident, Italian aerospace company Avio Aero , which built the Vega, said it had a 100% success rate.
The insurance loss for the rocket and satellite represents the largest recorded loss in the space market, satellite analysis firm Seradata said.
Until now, insurance premiums for commercial satellite and rocket accidents have been falling due to strong competition among insurers and improved rocket reliability.
But that could change in the aftermath of the Vega crash, leading to higher costs for space rocket launches.
“Space insurers have suffered two major claims within the past year and the cost of these losses far exceeds the premiums earned in this sector,” said Nick Brown, group chief executive at insurer Global Aerospace, which is backed by major reinsurers Munich Re and Berkshire Hathaway.
“Insurance rates for both launch and in-orbit have been at historically low levels and … need to increase significantly.”
The Vega loss follows the failure of Maxar Technologies’ WorldView-4 imaging satellite in January, resulting in a $183 million insurance claim.
Last year, space insurance payouts were $600 million, according to Seradata SpaceTrak data, outpacing premiums of around $450 million…