Briefing Notes

• A peer-reviewed study underscores insurers’ duty to cover catastrophic risks tied to commercial space activity.
• Despite record growth in satellites and human spaceflight, insurers remain opaque on asteroid and comet risk.
• Without regulatory mandates, policyholders may face blanket denials if a space-related disaster strikes.

USA HERALD - In our previous coverage at USA Herald, we called out the insurance industry for treating the disappearance of interstellar comet 3I/ATLAS from Earth’s skies as a convenient excuse to stand down. With the object hidden behind the sun, reporting on space risks slowed, and insurers showed no urgency in modeling for the possibility of catastrophic impacts or orbital disruptions. That silence, we argued, looked like a dangerous abdication of duty to policyholders and shareholders alike.

Now, a detailed study published by the International Journal of Engineering Technology Research & Management confirms our concerns. The paper, Space Insurance for Commercial Space Activities: Navigating the New Frontier by Surya Narayan Saha, lays out how insurers should already be building advanced models for launch, in-orbit, and third-party liabilities tied to space activity. Instead, the industry continues to compartmentalize risk into narrow coverage products—launch, satellite, or third-party damage—without confronting the far broader implications of an asteroid event or interstellar object like 3I/ATLAS.

What the Research Shows—and What Insurers Ignore

The IJETRM paper points to an exploding commercial space economy—valued at over $423 billion in 2019 and expected to surge past $700 million for insurance premium markets by 2028. Small satellites, mega-constellations like Starlink, and space tourism all bring new liabilities. Insurers are responding with technical products covering payload loss, in-orbit malfunction, or suborbital tourist injury. Yet none of these address systemic risks from a space-borne catastrophe that could shatter satellites, disrupt communications, or devastate urban areas if debris reaches Earth.

The study stresses best practices: comprehensive risk assessments, collaboration with aerospace experts, ongoing data analytics, and flexible coverage plans. It even underscores the rising threat from orbital debris and solar storms. But where is the transparency from insurers in the United States and Europe? Shareholders hear about quarterly premium pricing shifts. Policyholders hear about “acts of God” exclusions. What neither group hears is how carriers would respond if a close-approaching asteroid, such as Apophis in 2029, altered orbital dynamics or damaged satellites critical to global commerce.

Liability, Law, and the Risk of Denial

The legal stakes are significant. International treaties such as the Outer Space Treaty and Liability Convention establish frameworks for claims arising from space activities. Yet private insurers have made no comparable disclosure of how these frameworks would translate to mass claims from ordinary businesses, homeowners, or municipalities if a celestial event caused ground damage. Would carriers pay? Or would they invoke exclusions en masse, leaving governments to act as backstops while shareholders flee?

The journal warns of market volatility: over 40% of insured losses in space insurance occur during launch, and about 41% occur within the first two months in orbit. If losses from a single satellite failure can rock pricing, imagine the impact of a cascading satellite collision triggered by debris from a comet or asteroid. The absence of a public plan, disclosure, or even an industry dialogue on this front is no less than a breach of the duty to prepare.

Case Studies Show the Limits

Case studies highlighted in the IJETRM article show insurers underwriting SpaceX launches, OneWeb’s mega-constellation, and Blue Origin’s suborbital flights. These policies are finely tuned to very specific risks: a rocket explosion, a satellite collision, or an injured space tourist. But none of them speak to the broader catastrophe model that would apply if an interstellar object were to disrupt Earth-orbiting systems.

As we reported previously, the silence on 3I/ATLAS is not harmless. It is a warning sign. While insurers experiment with granular coverage for space tourism, they avoid the more frightening modeling question: what happens if the next asteroid doesn’t miss?

What’s Next

Astronomers will regain sight of 3I/ATLAS soon, and Apophis’s 2029 flyby is not far on the horizon. For insurers, the procedural roadmap is clear. They must disclose their space-risk modeling, update policy language to address space events directly, and prepare contingency plans for claim processing. Regulators in Washington, Brussels, and beyond may be forced to mandate disclosures, just as climate risk reporting has become compulsory in securities filings. Without that, the next major celestial scare could also trigger litigation against insurers accused of misleading shareholders or abandoning policyholders.