Extreme space
weather: The role
of insurance
How insurance can respond
The insurance industry is well equipped to help businesses prepare for future solar storms – our market has a wealth of expertise in understanding risk, as well as the ability to provide a financial safeguard to limit the economic impact of a major event.
At Lloyd’s we have a rich history of insuring the space industry, dating back to the Earlybird satellite in 1965, but a solar storm doesn’t only impact assets in space; there are also tangible and economic impacts on Earth. Space weather is an evolving area of coverage as we continue to broaden our knowledge and raise awareness of this threat. Here we have explored the spectrum of financial support and protection available against the economic impacts of a solar storm event.
© Max Alexander/Lloyd’s “Life in the Sun’s Atmosphere”, please note a credit is required to use this image
Key product considerations
Space insurance: At time of publishing, Lloyd’s covers nearly a third of all underwritten global space risks, offering comprehensive protection for satellites throughout their entire lifecycle – from development and launch to operation and decommissioning. Satellites are intricate and expensive pieces of technology that are critical for enabling communication and navigation. Solar storms can severely damage satellites by frying their electronics and contributing to their degradation. Space insurance provides financial compensation for satellite loss of capability or replacement, and occasionally loss of revenue from service interruptions, ensuring satellite companies can quickly recover maintaining continuity in critical global networks.
Property insurance: Infrastructure, buildings and equipment are all vulnerable to damage caused by power surges and electrical fires during a solar storm. Property insurance helps businesses manage these risks by covering for the costs of repair or replacement for damaged infrastructure.
Business interruption insurance: Reliance on technology, power and communication connectivity means in the face of a power outage or GNSS disruption, business operations can come to a standstill. Business interruption insurance provides coverage for the extra costs involved with getting back online and income lost during the downtime, after a defined interruption period has passed.
Energy insurance: A geomagnetic storm could overload transformers and cause cascading failures in the electricity grid. Energy insurance provides critical financial support to energy suppliers and operators by covering the costs associated with machinery breakdown and repair or replacement of damaged energy-related infrastructure.
Aviation insurance: Aviation insurance can minimise the impact to airport services and help maintain passenger trust by addressing the damages and delays that may arise due to disruptions to GNSS navigation and communication systems. Insurance can provide financial compensation for damages to aircraft and aerospace systems and third-party liabilities from delays or injuries.
Marine cargo insurance: Disruption to GNSS can mean ships are forced to remain stationary until systems regain signal. These delays can be costly, especially if time-sensitive cargo, such as food or pharmaceuticals, expire and are spoiled. Marine cargo insurance includes a range of covers that can provide financial protection against losses arising from physical damage to cargo, and related liabilities while it is in transit by sea and in storage.
Agriculture insurance: Modern farming equipment is heavily reliant on GNSS for activities such as automated planting, fertilising, and harvesting, which if disrupted, can leading to reduced efficiency, reduced yield and potentially lost harvest. Livestock and crop insurance can compensate damage to or destruction of farmers’ stock, business continuity costs, and create access to credit facilities to support risk mitigation.
Construction insurance: Geomagnetic disturbances can scramble construction control systems, which may disrupt business operations and create safety hazards on construction sites[23]. Along with covering any costs associated with physical damage to the building site and injuries to workers, coverage is also designed to protect against the loss of anticipated revenues from projects that get delayed. [24]
Directors and officers (D&O) insurance: Solar storms can disrupt the digital systems many businesses rely on to operate and make transactions. Financial losses, operational failures, or neglected safety procedures expose businesses to reputational damage and lawsuits alleging negligence or mismanagement. D&O insurance protects businesses by covering for the legal defence costs and any compensation to third parties.
Political violence and terrorism (PVT) insurance: In extreme cases, offline security cameras or inability to access money through ATMs or digitally could lead to looting and ATM vandalism. PVT insurance incudes coverage for financial losses due to strikes, riots and civil commotion.
Cyber insurance: Digital vulnerabilities can become more pronounced during and after solar storms. Disruption to digital systems can create unexpected entry points for malicious actors to orchestrate cyber-attacks during recovery efforts. Cyber insurance protects businesses against financial losses derived from data breaches or malfunctions and any third-party liabilities that arise post cyber-attack.
[23] https://specialty.ajg.com/plane-talking/the-insurance-implications-of-solar-flares?overlay=Solar-Flare-Construction
[24] https://www.marsh.com/en-gb/industries/construction.html
© Max Alexander/Lloyd’s “Life in the Sun’s Atmosphere”, please note a credit is required to use this image
Facing into a braver future
As an industry we should be prepared for a range of possible solar storm scenarios and draw on our wealth of risk experience to shape insurance coverage and advise customers on the most appropriate preventative actions. To fulfil this vital role, insurers could consider:
Education and awareness: The impact of solar storms on critical infrastructure on Earth needs to be more widely discussed so that we are prepared for potentially widespread and costly disruption. The insurance community can help to raise awareness of the threat. This can lead to risk owners having a better understanding of their vulnerabilities, and potentially more coverage being made available by insurers to protect these businesses. In 2025, Lloyd’s Futureset held an immersive photography led exhibition Life in the Sun’s Atmosphere, by acclaimed science communicator Max Alexander, highlighting the impact space weather poses to society by documenting at risk infrastructure and the global efforts at mitigating the threat.
Collaboration: Our market proudly pioneers innovative resilience solutions, often enabled through collaboration with industry and subject-matter experts, the private sector, government, and policymakers. Such partnership opportunities help to drive awareness and innovation solutions to manage the impact of extreme space weather events. In 2025, Lloyd’s Futureset held a space weather event to convene and provide a platform for experts, government and the insurance industry to exchange insights and collaborate to address key challenges within the space and infrastructure sector.
Lloyd’s proudly partners with the Earth∞Space Sustainability Initiative (ESSI), working closely with academia; international and government organisations including UK Space Agency and the UK government Department for Science Innovation and Technology (DSIT); and industry to scale the accessibility of space insurance coverage, including protecting satellites from risks associated with space weather.
Understand the exposure: Space weather damage footprints can cross countries and industries. It is important that insurers understand the impact of space weather events on their portfolios. Stress and scenario testing - such as the 2024 Lloyd’s Extreme Disaster Scenario (EDS) exercise aimed at understanding how Lloyd’s insurance policies might respond to a solar storm event - can support the careful management of potential tail event aggregations. A strong understanding of potential exposure allows insurers to be in a more confident position to offer protection to businesses, knowing they hold adequate capital to withstand a major event.
Educate and engage customers: Traditional business interruption cover under a property insurance policy typically protects against expenses or losses because of physical damage to the customers’ own property or assets. Customers who have not purchased additional “non damage business interruption” cover may not be protected against outages to critical services that are essential to their operations. This is most easily seen in supply chain disruption and perishable goods where time is of the essence and a backlog can create associated losses. Rare failures in the banking system such as lost trades from high-frequency trading – reliant on GNSS for successful completion - or marine collisions due to GNSS outages could also expose a protection gap for businesses. Insurers and brokers have a role to play in engaging customers and explaining any potential gaps in coverage to make sure they understand how their insurance policies will respond to space weather events and that they have appropriate protection in place.
The government perspective
A key role of government in managing a risk of this nature is in strengthening resilience in national networks and preparing emergency contingencies for any length of total or sweeping outage.
Governments have a critical role to play in ensuring that both critical national infrastructure and the wider public can withstand the effects extreme space weather. This can include investing in research to improve space weather monitoring and forecasting services, or developing contingencies with critical service providers to supplement or supplant disabled infrastructure, and educating the public on the steps they can take in the event of critical service outages.
Prediction and monitoring
Prediction and monitoring: As with extreme weather such as flooding and tropical storms, the best way to prepare for a potential catastrophe is to understand the system, monitor patterns and activity, and develop the ability to predict an event. Some scientists say that space weather prediction capabilities are currently about 50 years behind meteorology25, but given the potential financial impact of a solar storm could rival that of an extreme weather event, it is vital governments invest resources into developing their forecasting proficiency. In the UK, the Met Office Space Weather Operations Centre (MOSWOC) is one of a handful of 24/7 space weather prediction centres around the globe, providing forecasts and warnings of space weather for Government and responder communities, critical national infrastructure providers and the public26.
The proposed 2031 European Space Agency (ESA) Vigil mission will provide near real-time data on potentially hazardous solar activity, allowing time for vulnerable spacecraft and ground infrastructure to take necessary actions to minimise their risk to solar storm exposure27.
Research and investment
It is important that governments take time to understand how to prepare for adverse space weather events and where to prioritise funding to build resilience.
In 2019, US Congress passed the Promoting Research and Observations of Space Weather to Improve the Forecasting of Tomorrow PROSWIFT Act, empowering NOAA (The National Oceanic and Atmospheric Administration, who are the US’s scientific and regulatory agency in charge of weather surveillance), NASA, the National Science Foundation, industry, and academia to carry out research to advise the US on how to proceed in building defences to space weather28.
Similarly, in the UK, following the 2021 Severe Space Weather Preparedness Plan, UK Research and Innovation (a public body sponsored by the Department for Science, Innovation and Technology (DSIT)) invested £20million into the Space Weather Instrumentation, Measurement, Modelling and Risk SWIMMR programme aimed at supporting policymakers by identifying opportunities to improve space weather resilience in UK critical national infrastructure. The research identifies 40 recommendations for policyholders to improve space weather resilience, across the Space, Energy, Communications, and Transport sectors.
Explore the impact of extreme space weather
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This report has been produced by Lloyd's Futureset and Cambridge Centre for Risk Studies for general information purposes only.
While care has been taken in gathering the data and preparing the report Lloyd's and Cambridge Centre for Risk Studies do not, severally or jointly, make any representations or warranties on behalf of themselves or others as to its accuracy or completeness and expressly exclude to the maximum extent permitted by law all those that might otherwise be implied.
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Note that this report does not seek to replace or inform any of the mandatory scenarios which Lloyd’s publishes to support the Realistic Disaster Scenario exercises managing agents are required to undertake in respect of the syndicates managed by them.