Evaluating and purchasing a communications satellite system - Insurance Costs
From INVESaTWIKI
Insurance costs
The cost of insurance for in-orbit satellites represents a
considerable portion of TCO. Insurance costs for the
various satellite platforms can vary by 10 percent or
more, which can equate to at least $20 million for a $200
million satellite and launch vehicle procurement.
Other insurance considerations are whether the satellite
is likely to be fully or partially insured or subsystem
risks excluded in their entirety. On some satellite
models, insurance coverage may exclude a component
that has a higher likelihood of failure based on anomaly
records.
The 2003 Frost & Sullivan study on satellite reliability
found that “simpler, leaner, more versatile design
platforms have been demonstrated to be more reliable.
On-board autonomy further enhances reliability by
improving anomaly resolution.”
The better the track record of a satellite platform and
launch vehicle, the stronger underwriter interest will be
in providing insurance. Increased demand by the
underwriter community leads to competition for the
business and, ultimately, more attractive insurance
prices for the operator.
The Frost & Sullivan Study shows a trend toward
higher insurance premiums and an increasing number of
claims. [1]
References
[1] Satmagazine.com - January 2004
Satellite System Acquisition: A Fresh Approach to Evaluating and Purchasing a Communications Satellite System
