Launching one of the richest individuals on Earth into orbit has proved a leap too far for insurers, who are not ready to price the risk of losing Jeff Bezos or his fellow space travelers.
Amazon CEO Bezos, a lifelong space enthusiast, has been vying with Tesla Inc CEO Elon Musk and British billionaire Richard Branson to become the first billionaire to fly beyond the Earth’s atmosphere.
While insurers are well known for offering cover for even the most outlandish of risks, at a price, potential accidents in space are not yet among them.
Photo: Reuters
“Space tourism involves significant risk, but is not an issue life insurers specifically ask about as yet because it is so rare for anyone to travel into space,” Insurance Information Institute spokesperson Michael Barry said.
There is a nearly US$500 million market to insure satellites, rockets and uncrewed space flight, but no legal requirement for an operator such as Blue Origin, which Bezos founded, to insure passengers for injury or death or for space tourists to have life cover, brokers and insurers said.
“We’re not aware of a case where anybody is insured against passenger liability,” said Neil Stevens, senior vice president, aviation and space at Marsh, the world’s biggest insurance broker.
Assuming they lift off as planned next month, Bezos and the other wannabe astronauts on Blue Origin’s New Shepard spacecraft would not only spend several minutes 100km above the Earth in a truck-sized capsule, they would also have to get back.
The only group that has regularly flown humans sub-orbitally since the 1960s is Branson’s Virgin Galactic. All have been tests, with one failure in 2014 resulting in a death. Blue Origin has flown 15 uncrewed sub-orbital flights with no failures, Seradata SpaceTrak data showed on June 10.
Bezos, Blue Origin and Virgin Galactic did not respond to requests for comment from Reuters on their insurance plans and flight records.
Being uninsured in space is nothing new. NASA and the US, in general, do not buy liability cover, with government launches basically insured by taxpayers, said Richard Parker of Assure Space, a unit of insurer AmTrust Financial that provides space insurance.
NASA astronauts are eligible for government life insurance programs, a NASA spokesperson said in an e-mailed response.
Charles Wetton, underwriting manager for space policies at insurer Global Aerospace, said astronauts on government-funded missions are carefully selected for their knowledge, skills and fitness and train for several years before blast off.
“They and their families understand the risks of the work they do,” Wetton said.
However, commercial space cadets may only get a few days of training for a sub-orbital flight or a few months for a ride to the International Space Station (ISS), Wetton said, adding: “These represent two very different risk profiles that insurers will take into account.”
Insurers expect ironclad waivers and contracts from commercial space travel firms, stating they will bear no burden if a passenger dies during a flight.
NASA has called for responses from the industry for its plans for a liability framework for privately funded astronaut missions to the ISS. NASA’s plans include requiring private astronauts to buy life insurance.
The only mandatory insurance in place for commercial space operators is third-party liability, mainly to cover property damage on Earth or to a flying aircraft, said Akiko Hama, client executive, space and aerospace underwriting at Global Aerospace.
A key question for how the sector develops is whether risks related to tourism fall under space or aviation insurance lines, insurers and brokers said.
The UN Outer Space Treaty and the Liability Convention of 1972 governs all activities in space and very few countries have a legal framework for commercial human spaceflight, they said.
“The aviation, aircraft insurance market, and the like, are less keen to take on risks that involve spacecraft,” Stevens said, adding that whether space tourism trips fall under aviation or space insurance is a “million dollar question.”
Semiconductor shares in China surged yesterday after Reuters reported the US had ordered chipmaking giant Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) to halt shipments of advanced chips to Chinese customers, which investors believe could accelerate Beijing’s self-reliance efforts. TSMC yesterday started to suspend shipments of certain sophisticated chips to some Chinese clients after receiving a letter from the US Department of Commerce imposing export restrictions on those products, Reuters reported on Sunday, citing an unnamed source. The US imposed export restrictions on TSMC’s 7-nanometer or more advanced designs, Reuters reported. Investors figured that would encourage authorities to support China’s industry and bought shares
FLEXIBLE: Taiwan can develop its own ground station equipment, and has highly competitive manufacturers and suppliers with diversified production, the MOEA said The Ministry of Economic Affairs (MOEA) yesterday disputed reports that suppliers to US-based Space Exploration Technologies Corp (SpaceX) had been asked to move production out of Taiwan. Reuters had reported on Tuesday last week that Elon Musk-owned SpaceX had asked their manufacturers to produce outside of Taiwan given geopolitical risks and that at least one Taiwanese supplier had been pushed to relocate production to Vietnam. SpaceX’s requests place a renewed focus on the contentious relationship Musk has had with Taiwan, especially after he said last year that Taiwan is an “integral part” of China, sparking sharp criticism from Taiwanese authorities. The ministry said
US President Joe Biden’s administration is racing to complete CHIPS and Science Act agreements with companies such as Intel Corp and Samsung Electronics Co, aiming to shore up one of its signature initiatives before US president-elect Donald Trump enters the White House. The US Department of Commerce has allocated more than 90 percent of the US$39 billion in grants under the act, a landmark law enacted in 2022 designed to rebuild the domestic chip industry. However, the agency has only announced one binding agreement so far. The next two months would prove critical for more than 20 companies still in the process
CHANGING JAPAN: Nvidia-powered AI services over cellular networks ‘will result in an artificial intelligence grid that runs across Japan,’ Nvidia’s Jensen Huang said Softbank Group Corp would be the first to build a supercomputer with chips using Nvidia Corp’s new Blackwell design, a demonstration of the Japanese company’s ambitions to catch up on artificial intelligence (AI). The group’s telecom unit, Softbank Corp, plans to build Japan’s most powerful AI supercomputer to support local services, it said. That computer would be based on Nvidia’s DGX B200 product, which combines computer processors with so-called AI accelerator chips. A follow-up effort will feature Grace Blackwell, a more advanced version, the company said. The announcement indicates that Softbank Group, which until early 2019 owned 4.9 percent of Nvidia, has secured a
RSS