When shopping for auto insurance, health insurance or even homeowner’s insurance, have you ever stopped and wondered what types of insurance specific industries or businesses require? While many individuals and families purchase, cancel, lapse and modify personal lines of insurance each and every day, businesses often only assess insurance needs during periods of open enrollment or when changes in risk occur.
The space program is a unique industry in the United States. And, like other industries and businesses, the NASA space program carries specific forms of risk and, therefore, specific types of insurance protection. While insurance for space travel was once considered a limited exposure or trigger event on which insurance was purchased, today it is generally carried for the long-term due to the frequency with which space exploration takes place.
Consider for a moment, then, what you would expect to occur when a space shuttle, or other space exploration, disaster occurs. While we clearly understand the financial risk involved in the loss of space shuttle property and the loss of space shuttle crew members, we rarely to think of the third-party liability involved. Because third-party liability is quite diverse, insurance underwriters may have difficulty insuring events accurately for their risk.
Each time a space exploration event takes place, therefore, it is most likely standard procedure that the underwriting insurance carrier would need to assess the risk for that particular space travel event and, ultimately, determine what premium, what deductive and what stop-loss and re-insurance protection should be carried. In addition, the underwriter must decide what types of losses must be excluded. Often, these exclusions are coverages are highly charged topics of discussion but are necessary to ensure the protection, financially, of anyone potentially affected by a liable event.
In the unfortunate accidents, in recent years, that involved space shuttle destructions, there were property and individuals who may have been adversely affected by the event. In those cases, the insurance coverage that extended liability protection to NASA would, ultimately, carry the financial risk to settle those claims for protection accordingly.
The next time you purchase auto insurance coverage, life insurance, health insurance or even your own travel insurance protection, take a moment to consider the financial implications that may be associated with even the most notorious businesses. In the United States, even space shuttle exploration and space research and non-human events must be carefully underwritten and insurance based on their particular risks.