Help! column: Insurance does cover launch disasters

May 21, 2008

Florida Today--May 21, 2008

Dear Help!: My dad and I recently watched a disaster program on TV that showed a rocket blowing up moments after takeoff. It was carrying a multimillion-dollar satellite.

That got us to wondering, is there insurance to cover these types of incidents? How much does it cost? Michael Bollerman,

Asked about launch insurance was George Diller, a communications professional at Kennedy Space Center since the early 1980s. Diller’s familiar voice is heard on NASA Television, where he serves as launch commentator for the shuttle and expendable launch vehicles.

The insurance rule of thumb he offered could not have been any more straightforward: “If it’s a commercial launch, yes; if it’s a government launch, no, because the government self-insures.”

Diller said a consortium of industry agents underwrites insurance coverage for launches of the commercial variety.

“Premium rates are based on a certain percentage, generally a low percentage, of mission costs,” he said.

A review of the literature about the satellite launch market led to an April 14 article in Business Insurance magazine that shed more definitive light on the prevailing cost structure. Written by Stacy Shapiro, the story told of the recent failure of a Russian Proton Breeze-M rocket to launch a communications satellite into proper orbit.

The AMC-14 satellite was owned by SES Americom of Princeton, N.J., and was insured for $192 million, the article pointed out. The Business Insurance story went on to say: “Experts agree that rates were between 10 percent and 11 percent of a satellite’s value last year. They will be between 13 percent and 16 percent this year, with the average being between 14 percent and 15 percent, brokers and underwriters now predict.”

Stuff happens: Brevard Freecycle-rs (with hyphen) is the new formal name of the group wrongly but inadvertently referred to in this space last week as Brevard Freecyclers (without hyphen).

This time, blame for the mess-up actually can be placed on the computer. The text was right, as written, but the newspaper’s computer didn’t know it.

“That’s because we’ve written about that organization multiple, multiple times without the hyphen,” Features Editor Suzy Leonard commented in explaining how the computer “fixed” things to be like they always were.

Just so you’ll know, the group’s Web site remains www.brevard