As we look towards the fourth quarter of 2021, the space insurance market remains relatively stable with underwriter confidence continuing to increase alongside the opportunity to participate in a number of significant new insurance placements.
Plane Talking - Article 5

With several “big ticket” launch placements in particular coming into the market, it is clear that appetite for top tier risks is strong. Clients can therefore expect to benefit from a degree of rekindled competition between insurers as they vie to secure market share. Compared with the pricing that was available 12 months ago, we are seeing underwriters scale back rating for the most attractive risk profiles. Nevertheless, for placements that have high sums insureds and/ or perceived elements of heightened technical risk, underwriters are still seeking to leverage their positions.

In the absence of major losses, underwriters will undoubtedly look to build their core books around established fleet operators to ensure premium income through 2022 and 2023. Consequently, we expect the differential in pricing between challenging launch risks and more “vanilla” missions to stay significant for the foreseeable future.

A similar picture is also reflected in the in-orbit portfolio. In light of launch delays affecting the 2021 manifest, underwriters are all the more focused on maintaining their target in-orbit book. Again, technically challenging risks or those requiring high sums insured are likely to show a material differential in pricing compared to standard programmes.

Shifting gears to the New Space sector and within that, the UK space industry in particular, 2021 has seen new spaceflight laws put in place in the form of the Space Industry Act 2018, which is a flexible high-level regulatory framework enabling launch from UK soil from 2022. The legislation sets out regulation of a wide range of spaceflight technologies, including traditional vertically launched vehicles, air-launched vehicles, sub-orbital spaceplanes and balloons.

The UK’s Civil Aviation Authority (CAA) – whilst maintaining its watch over UK airspace - has been selected as the UK space industry’s regulator and issues relevant licenses in line with the new legislation.

In contrast, the UK Space Agency is an executive agency, sponsored by the Department for Business, Energy & Industrial Strategy, and is responsible for providing technical advice on the government’s space strategy, guiding the UK space sector to deliver government vision, promoting the UK space sector’s interests and achievements, making connections to join up industry and academia and representing the UK in international space programmes.

No fewer than seven UK spaceports are under proposal as shown in the table below:

Name Also Known As Location Launch Type
Spaceport Cornwall Newquay Airport Cornwall, England Horizontal
Prestwick Glasgow Prestwick Airport Ayrshire, Scotland Horizontal
Spaceport Snowdonia Snowdonia, Wales Horizontal
Sutherland Spaceport Space Hub Sutherland or UKVL Sutherland Sutherland, Scotland Vertical
SaxaVord Spaceport Shetland Space Centre Unst, Shetland Islands, Scotland Vertical
Spaceport 1 Scolpaig, North Uist, Scotland Vertical
Machrihanish Campbeltown Airport Argyll, Scotland Horizontal

Source: Royal Aeronautical Society

The spaceports are at varying stages of development and with the UK government having already awarded grants circa GBP40 million to establish commercial vertical and horizontal small satellite launches from UK spaceports, there is a clear willingness for these projects to succeed.

This note is not intended to give legal or financial advice, and, accordingly, it should not be relied upon for such. It should not be regarded as a comprehensive statement of the law and/or market practice in this area. In preparing this note we have relied on information sourced from third parties and we make no claims as to the completeness or accuracy of the information contained herein. It reflects our understanding as at 29 September 2022, but you will recognise that matters concerning COVID-19 are fast changing across the world. You should not act upon information in this bulletin nor determine not to act, without first seeking specific legal and/or specialist advice. Our advice to our clients is as an insurance broker and is provided subject to specific terms and conditions, the terms of which take precedence over any representations in this document. No third party to whom this is passed can rely on it. We and our officers, employees or agents shall not be responsible for any loss whatsoever arising from the recipient’s reliance upon any information we provide herein and exclude liability for the content to fullest extent permitted by law. Should you require advice about your specific insurance arrangements or specific claim circumstances, please get in touch with your usual contact at Gallagher Aerospace.
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