The ceding of part of the space risk underwritten by direct insurers to reinsurers, essential to absorb very large single losses.
Space reinsurance refers to the ceding of part of the risk underwritten by direct insurers to reinsurers, a mechanism essential in a market where a single loss can represent several hundred million dollars, a significant share of the total annual premium collected across the entire sector. Global direct space insurance capacity is narrow and concentrated among a limited number of specialized players; without reinsurance, a single insurer could not absorb the total loss of one major telecommunications satellite without endangering its solvency across all its other lines of business. Reinsurers most often step in on an excess-of-loss basis, covering the portion of a loss above a set threshold, or on a quota-share basis, taking a fixed proportion of every policy in a portfolio. Because the space market is both narrow and highly correlated, a year of heavy loss experience, such as a cluster of launch failures close together, can simultaneously harden terms in both direct insurance and reinsurance, with a lag of several months between the loss and treaty renewal that amplifies the market cycle specific to the space sector.
The loss of the Amos-6 satellite, destroyed with its launcher on September 1, 2016, for an insured value of roughly $200 million, alone consumed a significant share of the global space market's annual premiums, illustrating why reinsurance is essential to absorb a single loss of that scale.
space reinsurance, réassurance des risques spatiaux, capacité de réassurance spatiale