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GSLV launch wasn't insured

Madhumathi D.S.

ISRO plans for in-orbit spare capacity

Bangalore , July 11

The space segment is a high-risk proposition, yet the failed GSLV-F02 or the satellite on it, Insat-4C, was not insured.

"We are going in for a long-term alternative approach to insuring", against contingencies, as premium loads 20 per cent on the user as well as the operator (ISRO), said an insurance authority within ISRO who did not want to be named.

Spare capacity

"Instead of paying costly premia, ISRO has been planning to build in-orbit spare capacity for the long term so that user interests are not affected," the official told Business Line.

That means putting up an extra satellite for every series of 5-6 Insat satellites. This is what large fleet operators such as Intelsat, PanAmSat or SES Americom practice. If disaster should befall any of them, the users - for example, Doordarshan, private DTH and TV players or VSATs - can be readily shifted to the spare transponders without their services getting hampered.

The first such spare could have been in the present series, which has seven satellites running up to Insat-4G. Monday's loss of 4C may have tilted the Indian spacecart a little.


"As with all major Government of India properties like atomic energy plants, these were `self-insured'," the official said. Only `procured' services or launches made through foreign players have been insured: Insat-2E, the 3 series and 4A and the forthcoming 4B.

The Insat 1 series had four satellites (1A and 1 C were lost); the 2 series five - of which 2D died in orbit in its fourth month. The 3 series also has five, with 3D to be launched and the rest intact. For 2D, ISRO recovered $55 million in October 1997. 1C and 1A failed in orbit in the late 1980s and were compensated for.

An ISRO-built 2-tonne satellite such as the Insat-4C would cost Rs 100 crore; the GSLV launch another Rs 150 crore. A Ku band transponder as on 4C would cost around $1 million (Rs 4-5 crore).

The space insurance scene is a long chain of re-insurers spread across geographies, whose share of the pie and the risk would be between 5 and 15 per cent per event, according to Mr Srinivasa Raju, a Bangalore-based insurance domain consultant. Figuring among them are Allianz, AIG, Prudential; and in India, New India Assurance.

The ISRO official said the premia have risen from six per cent in the 1970s to 25 per cent in the 1980s, a decade marked by major failures. According to Mr Raju, space premia depend on the international market, operators' success record, event risk, and may change every six months unlike car or home insurance. Premia could harden if more launches fail and the supply dwindles, and vice-versa, he said.

Related Stories:
Agony revisits ISRO after 1997
GSLV crashes into Bay
A big jolt to India's launch programmes

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