Over the last decade the space technology company Astroscale has worked on using a satellite to ‘grab’ the debris and propel it to burn up in Earth’s atmosphere. Insurance had a critical role to play, protecting Astroscale from the possible costs of mission failure.
The space market generally provides insurance that protects a physical asset. In this case, the cover was designed to fund the repair or replacement of the satellite as well as launch costs in the case of a claim. Janette Sunshine, broker with Wilson Towers Watson, worked with Astroscale and underwriters to shape and secure the insurance coverage. “It was a privilege to be involved with this first-of-its-kind mission,” she says. “The challenge for us was to build a truly bespoke policy that really met Astroscale’s needs.”
Even Astroscale’s efforts, however, do not fully solve the problem, being unable to tackle small pieces of debris. So, in March 2022, Privateer joined the eighth cohort of start-ups in the Lloyd’s Lab – Lloyd’s ten-week accelerator programme that helps innovative ideas gain traction and success in the insurance market.
Privateer’s mission is to catalogue and process information about debris so that satellite operators can manoeuvre safely and effectively. Wayfinder is the firm’s first app, that allows satellite operators to inspect the layers of constellations, orbits and countries to better understand what’s happening around the Earth.
For Privateer, its relationship with Lloyds Lab has been pivotal in its development. From Privateer’s perspective, it was an opportunity to work with underwriters creating space insurance products and satellite operators who fly in low-Earth orbit where less than 3% of satellites are currently insured, as a step towards co-created insurance products.
While this work helps to improve the space environment; it does have a knock-on effect on one of the biggest challenges for humanity overall – climate change.
There are a new generation of much smaller Synthetic Aperture Radar (SAR) satellites arriving in space, much more vulnerable to debris. They need a clear atmosphere to work safely, but what they can deliver brings a step change in managing climate-related natural catastrophes.
The SAR satellites operated by companies such as ICEYE are able to provide rapid fire, fully interpreted and frequent information about flood, fire and hurricane-hit areas. ICEYE’s meteorologists also constantly watch the weather and other factors to issue advance forecasts of where they expect flooding to happen.
For insurance companies and government bodies, this is unlocking the possibility of observing and reacting to ongoing floods as never before. Persistent monitoring of floods through the use of SAR satellites contributes to faster, fact-based event response and can enable automated claims notification; support the partial automation of claims handling; and facilitate rapid loss assessment and more accurate reserving. The depth of data provided can also go further, and support solutions to provide safety nets for communities at risk of flood.
Having seen the potential, Lloyd’s have now announced a partnership with ICEYE and McKenzie Intelligence Services (MIS), which will allow the whole Lloyd’s insurance market to have access to their flood hazard analysis. A number of Lloyd’s insurers are now using this facility to develop innovative covers for vulnerable communities.
Lloyd’s was a pioneer of marine salvage for hundreds of years. How fitting, then, that it should usher in the age of space salvage and help set the course for the making our planet’s near atmosphere safer, helping to create a more sustainable future.
* Source, European Space Agency, 2022.
Imagery © Max Alexander/Steve Kelly