Obligation to insure space activities
Section 8 of the Act on Space Activities 63/2018) contains provisions on the obligation to insure that applies to space activities. Pursuant to the section, the operator must buy an insurance policy to cover damage caused by the space activities to third parties at least up to the maximum amount of the State’s right of recourse, which is 60 million euros.
A policy taken out in case of damage caused to third parties can be referred to as liability insurance. Liability policies cover personal injuries and damage to property for third parties that results from the launch, orbiting or return to Earth of a space object. The key principle of the Act on Space Activities is that a liability insurance policy must be purchased for space activities, which will cover the required amount of damages resulting from a space object’s
- launch and departure,
- operations, and
- its return to Earth.
The Act on Space Activities also contains provisions on when the Ministry of Economic Affairs and Employment may refrain from requiring the liability insurance referred to in section 8. Accordingly, the prerequisites for deviating from the insurance obligation are examined:
- On the basis of the coverage of the launch company’s insurance or similar insurance, and
- On the basis of a space activities risk assessment.
Under the Act on Space Activities, the Ministry of Economic Affairs and Employment may refrain from requiring the operator to purchase a liability insurance policy, if the insurance of the launching company or other similar insurance covers essentially the operator's and the state's liability for damage caused by space activities to third parties. In this context, responsibility for damage during the launch phase is considered of key importance. When the Act was enacted, it was thought that in the event of damage during the launch phase, the launcher has liability insurance for the launch, and that the owner or operator of the satellite as the customer will be covered by the insurance.
Where such an insurance policy is in place, its scope will be examined:
a) in terms of the sum of money: The Finnish operator and its space object must be insured up to a minimum of EUR 60 million, and
b) in terms of time/coverage of the activity: The insurance shall cover at least the launch phase of the space object and the related activities until the space object has reached its orbit.
As a rule, the obligation to insure also applies to the period following the launch. This will cover the launch phase, orbit phase and return to the Earth.
The Ministry of Economic Affairs and Employment may refrain from requiring liability insurance for the period after the launch phase if, on the basis of an assessment of the risks of space activities, the risk of damage on the Earth’s surface, in the air and in space caused by space activities is acceptable to the Ministry of Economic Affairs and Employment. Provisions on the permissible risk limits are laid down in section 5 of the Ministry of Economic Affairs and Employment Decree on Space Activities.
If, throughout a space object’s lifecycle, its risk of collision with another space object of a diameter of at least 10 cm is less than the risk limit laid down in the Decree on Space Activities, it is possible to deviate from the insurance obligation. In addition, the probability that the return of a space object or its components to the Earth would result in personal injury is less than 1/10,000. Accordingly, the authorisation process examines the risk assessment on space activities and the calculated
a) probabilities of collision in orbit; and
b) the probability of personal injury as regards the return of a space object to Earth.