Space insurer Swiss Re leaves market
WASHINGTON — Swiss Re, the world’s second largest reinsurance company, informed clients and brokers July 31 that it has stopped insuring satellites and launches.
Jan Schmidt, the head of Swiss Re’s space underwriting division, said in an email obtained by SpaceNews that the decision to “cease Space underwriting with immediate effect” was driven by “bad results of recent years and unsustainable premium rates.”
Schmidt emailed clients and brokers the same day Swiss Re board member Andreas Berger told Reuters the company is reducing its space exposure as part of a broader effort to stem losses in its corporate insurance divisions.
Swiss Re’s decision to stop underwriting new space policies follows the destruction of the Emirati imaging satellite Falcon Eye 1 during a July 10 Vega launch failure, costing insurers an estimated 369 million euros ($407 million).
Insurers were already stomaching a $183 million payout to Maxar Technologies for the failure of its WorldView-4 imaging satellite in January.
Another launch or satellite failure could drive even more insurers out of the space market, according to Richard Parker, divisional president of Assure Space.
The space insurance market is already facing perfect storm conditions, he said — an oversupply of insurers, a dearth of geostationary satellite orders, and declining prices for satellites and launches.
The space industry had a third failure when Intelsat-29e stopped functioning in April, but the satellite was not insured. Parker said another loss of an insured asset could cause insurance prices to rise even more than they have from the WorldView-4 and Falcon Eye 1 failures.
In a July 31 financial report, Swiss Re said it had taken actions to “Significantly reduce General Aviation & Space exposure.” The company generated $953 million in revenue for the first half of the year, down $53 million compared to the first six months of 2018.
SpaceNews Editor in Chief Brian Berger contributed to this story from Washington.