To space...and (not too far) beyond

Virgin Galactic hopes to soon be the first commercial space tourism venture to successfully send passengers into Earth’s sub-orbital microgravity. If, and when, it happens, it will mark the long anticipated arrival of space tourism, with several other competitors including XCOR Aerospace, Copenhagen Suborbitals and Airbus also aiming to launch their own sub-orbital experience. The UK could even have its first commercial spaceport by 2018, with eight potential sites recently listed for consideration, from Cornwall up to Stornoway in the Outer Hebrides.​

The insurance challenge will come when passengers are introduced

Like the early days of aviation, however, there is a potentially bigger prize at stake than taking the very rich or famous far up in the sky, says Pascal Lecointe, Space Line Underwriter for Hiscox London Market. “Space tourism appears risky and there is no real economic interest given the limited numbers expected to fly. But if, as happened once aeroplanes started to be used for passenger travel in the 1920s, space tourism leads to three-hour passenger flights between London and Sydney for example, or the ability to launch satellites in lower Earth orbit, then we could be on the verge of an exciting new era in space flight.” 

A return ticket to the ISS please

Space tourism is not a new concept. US company Space Adventures has already sent seven private individuals to the International Space Station (ISS) since 2001 on board Russia’s Soyuz, with singer Sarah Brightman due to be the next one up in 2015. At a cost of $52 million however, it has no mass-market appeal. Whereas Virgin Galactic – while hardly cheap at $250,000 a trip for each passenger – makes a trip to the stars far more achievable, even though space purists may complain that sub-orbital flight is not true space travel. In fact, the intended limit for Virgin Galactic’s SpaceShipTwo is to what is known as the Karman Line, at an altitude of 100km above Earth. At that height passengers will be on the threshold of space, but it will be high enough for them to experience five minutes of weightlessness.

While it may be only 100km up, the challenges of developing a reusable spacecraft that can successfully and safely achieve micro-gravity time after time are still enormous. “At the moment, we can say that human space flight has a reliability percentage of 99%. Those sorts of margins are acceptable for the military and governments, but what passenger aircraft would fly if one in a hundred flights ends in disaster?” says Lecointe. “For space tourism to succeed there is a fundamental requirement for reliability to exceed 99.99%.” 

London insures the challenge

With that level of risk, it might be expected that insurance placement would be difficult but, for now, the insurance arrangements for Virgin’s operation have been relatively straightforward. “The hull cover and third party liability in the test phase is already being picked up in the London aviation market,” says Ian Keegan, Aviation Line Underwriter for Hiscox London Market. “The insurance challenge will come when passengers are introduced.”

Keegan adds: “One of the appeals of setting up base in New Mexico (as Virgin Galactic has done) is that the state has passed legislation to not only protect spacecraft operators from passenger liability lawsuits but, through The New Mexico Expanded Space Flight Informed Consent Act passed into state law in 2013, also provides protection for the supply chain. In addition, the operating environment is important as the weather in New Mexico is constant through the year, while the US Air Force base nearby means there is little issue with civilian aircraft.”

For space tourism to succeed there is a fundamental requirement for reliability to exceed 99.99%

Convergence of the twain​

​If, as hoped, Virgin Galactic and its competitors can herald in a new era of super-fast, sub-orbital flight between major cities, it could also be the beginning of a structural change in the space/aviation insurance market. “While space tourism will call on many different parts of the aviation and space insurance markets, true convergence of the two will only happen when operators start to fly regularly in the upper atmosphere for intercontinental travel,” concludes Keegan.

The insurance challenge will come when passengers are introduced

For now, Richard Branson and his family alongside a host of celebrity flyers including Leonardo DiCaprio, Ashton Kutcher, Brad Pitt and Angelina Jolie, wait to take the first flight in SpaceShipTwo from New Mexico’s Mojave Desert. If the Mojave desert is too far for you to travel, console yourself with the thought that you could soon be boarding a three hour flight to Sydney from Newquay Galactic Spaceport.

Space tourism by numbers

  • 2001 – American businessman Dennis Tito became history's first space tourist, paying his own way to the International Space Station
  • 100km – the altitude necessary to achieve sub-orbital flight (the International Space Station orbits at 370km)
  • $20-40m – the cost of a return ticket to the International Space Station onboard Russia’s Soyuz
  • $250,000 – the cost of a return ticket to sub-orbital space onboard Virgin Galactic’s SpaceShipTwo
  • 5 minutes – expected time in micro-gravity when travelling with Virgin
  • $70m – the amount already paid in deposits by the 600 people who have signed up to travel with Virgin Galactic

Contacts

Pascal Lecointe
Line Underwriter - Space Risks
+ 33 (0)1 53 21 8372
[email protected]

Ian Keegan
Line Underwriter, Aviation
+44 (0)207 448 6435
[email protected]


Contacts

Written by Sebastian St.John-Clarke

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