back to article Space insurers make record-breaking loss as orbit gets cramped

The space above the Earth is getting increasingly crowded as launches become more frequent and satellites are squeezed closer together. Space insurers paid out a record $995 million in claims during 2023, according to a report from Slingshot Aerospace. This surge in orbital launches and satellite deployments was driven largely …

  1. Neil Barnes Silver badge

    An incentive perhaps

    To design all orbital vehicles for *controlled* re-entry after their useful life, with parachutes and suchlike to get them down in the right place at the right time?

    (Curiously, my grandfather's reference book 'Riley on Consequential Loss' eighth edition, included chapters on satellite insurance risks... thirty years ago.)

    1. Tom Womack

      Re: An incentive perhaps

      Very impractical from geostationary orbit - I did do a conceptual design for a GEO-to-disposal tug for my MSc thesis, but it would have been the biggest set of ion engines ever operated, with about half the solar power of the Space Station and very optimistic assumptions about how much iROSA arrays could be made to weigh, and it required an entire Falcon-9 load of replacement argon, hydrazine and N2O4 per satellite deorbited. The problem is that the disposal burn has to be impulsive and so needs to be chemical, and then you have to do a similar burn the same size so you don't dispose of the tug too. The design was really fragilely dependent on the exact tankage fractions for the argon.

      1. cyberdemon Silver badge
        Mushroom

        Insure this

        Russia developing space nuke to knock out swaths of satellites with EMP wave

        I'd hope that satellites are already resilient to solar flares and intense radiation, so i wonder how many would be destroyed by such a blast and what would it do to the space junk situation..

        1. Mishak Silver badge

          Re: Insure this

          Their use would likely render LEO unusable for a long, long time.

          Just the sort of thing a madman like Putin would consider "a reasonable outcome" if he doesn't get his way.

      2. DJO Silver badge

        Re: An incentive perhaps

        Getting redundant satellites from GEO back to the Earth for disposal would need a huge amount of fuel. Up there a easier option is to push them further out to a parking orbit where they will not be a problem for anybody.

        1. markrand

          Re: An incentive perhaps

          Rather than returning geosynchronous satellites to Earth, would it not be acceptable to nominate one or more longitudes as parking areas with an attendant herding satellite which was equipped to fasten expired satellites together. At a speed differential of 10 miles per hour it would take just less than a year for any geosynchronous satellite to reach a single parking longitude.

  2. Anonymous Coward
    Anonymous Coward

    What type of claims are being paid out?

    The article talks about crowding in LEO and GEO and then about record insurance claims, without making a clear link between the two (or saying what is the source of those extra claims).

    I doubt very much it's a dozens of new satellite-on-satellite crashing action? that's the kind of thing where every single case makes the news.

    1. steelpillow Silver badge
      Boffin

      Re: What type of claims are being paid out?

      Launch and deployment failures account for the lion's share.

      I would guess that our faultless dot-coms have realised they can take greater development risks at the insurer's expense and are slipping their development prototypes through under the guise of the real thing. Government agencies are seldom guilty of playing the insurance markets like this (one of the few faults they are not noted for).

      Expect massive increases in premiums for unproven tech....

      ...then, next cycle, the collisions and near-miss orbit destabilisations will kick in too.

      1. Tom Womack

        Re: What type of claims are being paid out?

        No, insurers are generally not stupid and will not insure prototypes at a price that any prototype provider is wiling to pay.

        There were two huge claims in 2023: Viasat 3, where the operator was willing to pay for a fully-expended Falcon Heavy to get it up to GEO as fast as possible and then found that the giant unfolding antenna didn't unfold, and Inmarsat 6 F-2 whose power supply failed to provide power.

        Also, one provider of the extremely fiddly Power Processing Units required for operating large ion drives has a reliability issue which means that four big GEO satellites built by Northrup Grumman are running on one PPU and will die if that one does.

        1. steelpillow Silver badge

          Re: insurers are generally not stupid

          True. But they do not always respond to market changes in timely manner. For example flood insurance took a big hit in the first season or two of climate change. And you can hoodwink them if you are smart enough - remember how the collapse of the US mortgage market, through the bursting of a bogus-statistics reinsurance bubble, triggered the collapse of Lloyds Insurance?

          1. notyetanotherid

            Re: insurers are generally not stupid

            > ... triggered the collapse of Lloyds Insurance?

            Wires crossed?

            Lloyds of London, the insurance market, did once nearly collapse, but that was back in 1991 following exposure to liabilities over the Piper Alpha oil rig disaster in 1988 and reinsurance of (mainly US) health policies which were paying out asbestosis claims.

            Lloyds Bank had to be bailed out in 2008/9 having been strong-armed by the gov into taking over HBOS, which was on the brink of collapse due to risky lending in the UK and a reliance on wholesale money markets where funding dried up after Lehman Brothers collapsed in the US.

            Lehman Brothers collapsed into bankruptcy due to over exposure to US subprime mortgages and CDOs (mortgage-backed derivative investments); but not really directly related to insurance though.

            Or have I missed something?

      2. hoola Silver badge

        Re: What type of claims are being paid out?

        There is also the likelihood that someone like StarLink who is essentially treating their stuff as disposable does not insure them.

        Do you have to have "Third Party Insurance" for a satellite?

        StarLink has already proved beyond doubt that they don't give a stuff for other people s assets because they are essentially more valuable than a cube sat.

    2. General Purpose

      Re: What type of claims are being paid out?

      Just so. The two big claims that made up $793m of the total $995m had nothing to do with crowding, let alone collisions. In fact if it wasn't for the $445m claim for Viasat-3 Americas failing to deploy its reflector, the insurers would have been slightly in profit overall.

      1. John Brown (no body) Silver badge

        Re: What type of claims are being paid out?

        Yeah, someone made a losing bet, which is what the insurance industry is all about, and so are crying wolf to hike up their charges to recoup the loss. There is a problem with sats in orbit, and the problem is getting worse before it can ever begin to get better, but it's not the problem this insurer[*] is making it out to be.

        [*] even if they are claiming to be "the space insurance industry", it's really almost certainly just one, or one consortium. There will be other players in the game who still made a profit.

        1. Richard 12 Silver badge

          Re: What type of claims are being paid out?

          A one-off loss is exactly that.

          They've forgotten what insurance is, and just assume they'll make money for nothing every year.

          If there was no chance that a policy could ever pay out more than the premium then nobody would buy insurance at all.

          1. Anonymous Coward
            Anonymous Coward

            Re: What type of claims are being paid out?

            "If there was no chance that a policy could ever pay out more than the premium then nobody would buy insurance at all."

            I beg your pardon? Does e.g. Payment Protection Insurance ring any bells?

            In general in the late 20th and early 21st century, punters don't *buy* insurance, they are (mis-)sold it by commission based salespeople of all kinds, and Boards of Directors who see an opportunity for a personal fast buck.

            If technology comppanies and systems *had* to work properly (anything from airport terminals to "smart motorways" and a whole load of other stuff e.g. cheap outsourcers, cheap hardware, and maybe even antisocial media outfits and now so=called AI companies)

            Who pays for Boeing management's incompetence and lies?

            Who pays to insure the nuclear power cult?

            Etc.

    3. Andy The Hat Silver badge

      Re: What type of claims are being paid out?

      Their business is all statistics and assessment of risk. If the insurers get it right they drink champagne, if they get it wrong they bleat, increase premiums accordingly and drink more champagne. As long as there's enough capital stuffed under their mattresses, and customers want someone else to take the financial risk, insurers will ride the odd storm and make money ...

  3. Anonymous Coward
    Anonymous Coward

    Reduce your insurance premium by launching one of those long-mooted hoover satellites to catch and de-orbit junk. With launch costs at an all time low it seems somewhat no-brained, does it not?

    1. Persona Silver badge
      Coat

      Reduce your insurance premium by launching one of those long-mooted hoover satellites to catch and de-orbit junk .... and when it fails to work you claim on the insurance .... hmmm

      1. Dimmer Silver badge

        How much of this was space-X blowing up test rockets?

        As the smoke clears, Oh iit was supposed to do that!

        1. 42656e4d203239 Silver badge

          >>How much of this was space-X blowing up test rockets?

          Err none? why would they insure a test article against loss? Yeh, insure it in case it damages someone/thing other than SpaceX but not surely not against RUD.

        2. Anonymous Coward
          Anonymous Coward

          Not even a single one in their entire existence?

          If you're referring to the rather spectacular kabooms of their starship test launches over the last year, they obviously were all sub-orbital trajectories to make 100% sure they would not leave any debris in orbit since they expected those explosions. They're rocker engineers, ya know?

  4. spold Silver badge

    To summarise...

    Stratospheric profits go up in smoke?

  5. Michael Hoffmann Silver badge
    Meh

    Slightly confusing or misleading here: from the tenor of the article I thought the losses were already due to collisions because of crowding.

    Going to the actual report, it's clear that it's technical issues of launch and similar - with half of total losses coming from one major sat that suffered total battery failure.

    Should have been made more clear, ElReg.

    1. General Purpose

      Yes. The report came from the self-declared "leader in AI-powered solutions for satellite tracking, space traffic coordination, and space modeling and simulation" and by some coincidence trumpets orbit crowding, even though the insurance payouts and losses it highlights wouldn't have been saved by their "AI-powered solutions".

      1. RM Myers
        Coat

        Wait, you're not claiming that a company in the "AI" business would actually exaggerate the potential benefits of "AI", are you? I'm shocked, just shocked, that anyone could even imagine such a thing. The marketing mantra in "AI" is widely recognized to be "under promise and over deliver", after all. Shame, shame, a cynic is in our midst.

        1. General Purpose

          OK, in fairness to AI I'll admit that it's also a wild exaggeration to suggest that any "solutions for satellite tracking, space traffic coordination, and space modeling and simulation" at all would have saved the insurers their big payouts. The mention of AI is a very convenient marker though.

  6. Dave 126 Silver badge

    Article needs teaking

    As everyone else here as observed, the insurers' big losses are due to satellite failure unrelated to collisions or with more crowded orbits. That's insurers' losses.

    These mechanical failure-type incidents are the main reason for insurers upping their premiums.

    A much smaller contribution to the higher premiums is the larger number of satellites in orbit, according to the source report.

    1. Anonymous Coward
      Anonymous Coward

      Re: Article needs teaking

      Sprucing, shirley. Spruce has a much better strength-to-weight ratio than teak, very important for spacecraft.

      (I'll get my coat.)

  7. vincent himpe

    Space insurance

    Essentially gambling. They gamble they can keep your money. Space is hard. If it blows up, it blows up. Better spend money on the design so it doesn't blow up than to gamble with it.

  8. lowwall

    "Worryingly, it appears that Geosynchronous (GEO) satellites are starting to encounter the overcrowding issues seen in Low Earth Orbit (LEO). The report noted an approximate 33 percent decrease in average separation between satellites."

    There are 580 satellites in GEO orbits. GEO is a sphere with a surface area of 4*π*42164*42164 square km which works out to 1 satellite per approx 10 million square km (or 500 Wales or .5 kiloWales). Even if you cram them all directly above the equator, which they aren't, you've still got 456km per satellite.

    1. John Brown (no body) Silver badge

      So what your really saying is “Space is big. You just won't believe how vastly, hugely, mind-bogglingly big it is. I mean, you may think it's long way down the road to the chemist's, but that's just peanuts to space.”, yes?

      Thanks both to you and Mr Adams :-)

    2. David Hicklin Silver badge

      That's if they are equally spaced out, I think you will find some spots are getting pretty crowded

      Plus they will all be near the equatorial plane otherwise they would not be synchronous....

      1. General Purpose

        On the other hand, being synchronous they're not zooming towards each other.

      2. lowwall

        You are thinking of geostationary orbits. Geosynchronous orbits are only required to be above the same spot once per day and can be anywhere at the appropriate distance of 35,786km above the Earth's surface. Geostationary orbits are the subset of geosynchronous orbits that stay at the same relative location all the time. These do require the equatorial orbit.

        The very first successful communications satellite Syncom 2 was in an inclined (non-geostationary) geosynch orbit. Current examples include 3 of Japan's Quasi-Zenith GPS augmentation sats and 10 of China's BeiDou navigations sats,

  9. Henry Wertz 1 Gold badge

    FCC rules

    I'll just point out, the FCC effective 2020 updated their regulation "orbital debris order", previously it involved reporting what debris is expected from a satellite during normal operation (.... I assume that'd normally be none, other than propellant exhaust?) Effective 2020 it also requires a plan for deorbiting the satellite at end of service life which is expected to be followed. Then in 2022 Dish Network was fined $150,000 for Echostar VII running out of fuel; it was launched in 2002, and was intended to be moved to the 300km disposal orbit in May 2022. But in February 2022 they found it did not respond as expected to some regular maneuvering command, it was so low on fuel it didn't result in the expected thrust. They consulted with the FCC and decided to junk it several months ahead of schedule but it only reached a 122km orbit rather than 300km.

    Obviously $150,000 is a small fine, but this was the first fine they issued so this was primarily to indicate that they do in fact tend to enforce this rule. Part of the FCC settlement also requires improved procedures to assess how much fuel is left in these satellites and make sure none run out in the future.

    This doesn't help the overcrowding situation... but I was surprised to read in the article about "most" satellites having manuevering thrusters, I just assumed anything made from like the 1980s to present did.

    1. Richard 12 Silver badge
      Boffin

      Re: FCC rules

      "Normal operation" includes launch and deployment.

      It was common to use explosive bolts, untethered springs and similar things during deployment, so every satellite started off surrounded by a small cloud of debris.

      Most deployments involve separating the satellite from the launch vehicle, and many need to unfold or remove plugs and covers after launch.

      While you can tether some things, you also don't want them sproinging back and hitting a random part of the spacecraft.

POST COMMENT House rules

Not a member of The Register? Create a new account here.

  • Enter your comment

  • Add an icon

Anonymous cowards cannot choose their icon

Other stories you might like