Risk it (10/31/22)

Good morning, and Happy Halloween. To mark the occasion, we’re dressing up as the spookiest thing we could think of: a space program that’s way over budget and years behind schedule.

In today's newsletter:💫 Insurance on orbit 📡 SatixFy de-SPACs 🗓️ The week ahead

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A Closer Look at the Changing Space Insurance Landscape

Launching satellites to space is a risky business. The field of orbitally proven vehicles remains small, sensor and payload technology is new and constantly changing, and certain orbital regimes are getting more crowded by the month.

Insurers, of course, are no strangers to risk.

The space insurance industry dates back nearly 60 years. But the last few years have seen a sharp increase in the number of objects deployed in orbit—as concerns mount about geopolitical tensions in space, weaponization of the domain, and the risks of orbital debris.

The state of play

In the US, launchers are required by law to procure liability insurance for each mission, covering the launch personnel and the operator. For satellite operators, though, it’s a different story.

• “Companies in the US aren't required right now by the regulators to actually procure any type of liability insurance,” Marsh’s Patton Kline told Payload.

• On the insurance provider side, space is an opportunity to capitalize on a unique risk environment that’s entirely siloed from conditions on Earth.

• “Space is very interesting as a line of business for an insurance company, because it is uncorrelated from any other class of business,” Beazley’s Denis Bensoussan told Payload.

A quick history lesson

Geosynchronous satellite operators have a long history of procuring insurance for their satellites. Lloyd’s of London wrote the first space insurance policy in 1965.

Premiums for space asset coverage have historically been high, reflecting the nascent and risky technology. They can be 10-20x higher than aviation premiums. But between 2002 and 2019, nearly every year saw a further decrease in premiums.

Things changed, though, leading up to the 2020s. In 2018 and 2019, losses exceeded gross premiums. In 2019, total losses amounted to nearly $800M, driven by a few high-profile mission failures.

There’s much more where that came from…

This morning, we published the full 1,645-word space insurance feature on our website. The full article features more data and experts’ insight, along with a closer look at changing premiums, GEO vs. LEO insurance, changing risk appetites, and more.

Check out the full story here.

SatixFy Completes SPAC Merger

SatixFy completed its SPAC merger with Endurance Acquisition Corp ($EDNC) last week, after shareholders voted to approve the deal Wednesday. The Israeli satcom company had its first day of trading on the New York Stock Exchange on Friday, Oct. 28, represented by the ticker $SATX.

SatixFy 101: The company is a fabless chipmaker and developer of electronically steered antennas. It builds products ranging from satellite payloads to end-user terminals, and semi-recently unveiled a product that can connect commercial airliners and corporate jets with LEO, MEO, and GEO satellites.

• Yoel Gat, SatixFy’s founder and former CEO, passed away in April. He was a 40-year veteran of the satellite industry and also founded Gilat Satellite Networks.

• SatixFy’s HQ is in Rehovot, Israel, and the company has additional offices in the US, UK, and Bulgaria.

Financial details: In its March 2022 investor deck, SatixFy forecasts revenue jumping from $40M this year to $166M in 2024 (2021 revenues were $21.7M). But according to Israeli publication Globes, SatixFy slashed its 2022 revenue forecast by 75% this summer to ~$10M.

• SatixFy and Endurance, the SPAC it merged with last week, reduced the post-deal enterprise value of the combined business by 27%, from $500M to $365M in August.

Via management: “This is an exciting time for the satellite communications industry, with the emergence of LEO megaconstellations creating a massive opportunity for SatixFy’s next-generation technologies,” said CEO David Ripstein.

And then there was one…SatixFy’s de-SPAC leaves just Intuitive Machines as the last space company seeking to go public via reverse merger. Tomorrow.io, a weather forecaster with a planned constellation in the works, and D-Orbit, a last-mile space transporter, both walked away from SPAC plans earlier this year, citing harsh macro conditions.

Share this story with a brave space investor:

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In Other News

• China launched Mengtian, the third and final major module for its Tiangong space station, at 3:30am Eastern this morning.

• Firefly is reportedly looking to raise up to $300M, Reuters reports.

• SpaceX conducted a static fire test of a Falcon Heavy ahead of tomorrow’s expected launch for the Space Force.

• Raytheon ($RTX) sent $1M to a whistleblower over fake GPS test results sent to the USAF (h/t Bloomberg).

• NASA pushed the launch of Psyche to next October. Managed by ASU, the mission will explore a metal asteroid between Mars and Jupiter.

• iSpace says its lunar lander mission is now set to launch on a Falcon 9 no earlier than Nov. 22 (a slip from the Nov. 9–15 window the Japanese startup shared earlier this month).

• Lockheed ($LMT) invested $100M in Terran Orbital ($LLAP). The satellite manufacturer also announced that it’s ditching plans for a production expansion in Florida, and will instead focus on growing capacity at its Irvine, CA plant.

The View from Space

NASA has released a second image of the “Pillars of Creation.” This time, the image shows an active star-forming region as rendered by JWST’s Mid-Infrared Instrument (MIRI). Payload’s $0.02: the space telescope couldn’t have delivered a better Halloween-themed image if it tried.