Space Access ‘07 - Early Friday afternoon - FAA, legal issues and insurance

Michelle Murray is from the Federal Aviation Administration, the FAA . She is in the Office of Commercial Space Transportation. She covered some of the highlights of what FAS has done over the last year. She listed many of the highlights in space over the last year. For example that Blue Origin, Jeff Bezos‘ company, had received an experimental permit. There were six licensed launches last year.

Then she talked about some of the things coming in the future. She made the point that if you plan to launch for the X Prize Cup you should apply quickly. She said it would be best to get the application in as early as possible, plan on 180 days for the draft application to be approved. She covered some of the details of what is needed in the applications and the process. They are going to hold an Experimental Permit Workshop May 16th in DC. They are looking for ideas on what would be good to cover in the workshop.

There were a few questions:

One was about how long was a permit good for.
Good for a year, permit is for one design, so slight modifications are OK.

Wanted to know if the FAA employees were US citizens?
Yes, it is a requirement.

What are the approved space ports?
Kodiak, mahave, Oklahoma, Florida and Virigina. There are several others which are not, but I think she said they were in the process of being approved.

How made people in AST?
59



Next was a panel discussion on Reusable Launch Vehicle Flight Insurance

James Dunstan partner in a law firm, being involved with space about 20 years
Ralph Harp - been an underwriter for 37 years.
Kelly Alton - in insurance industry

Doug Griffith - you need insurance for liability. Doug reiterate part of his message from last night, that incidents will be governed by state laws.

Ralph said that the underwriter industry is very interested in the business of space flights.
Kelly went over how the FAA figured out their evaluation of the risk. They figure out the most likely accident scenario. They figure about three million dollars per casualty. He made the point that when underwriting a new situation they are very cautious. The insurance rate for the X-Prize last year was between $130,000 and $175,000.

Jim Dunstan would focused on insuring for space flight participants. Jim says we are moving from protecting test pilots to protecting customers. Each year we allow 40,000 people to die on the roads, and about 1,000 die each year from the air industry. We’ve had only two incidents with deaths in space travel in the last 20 years, both of them from shuttle accidents. With space travel society seems to treat death by space flight as a bigger deal.

There are different legal models:
No Fault - automobile
Negligence - automobile, domestic aviation
Strict Liability - with a cap on damages
Unlimited liability

Because of 1972 United Nations Article VII Outer Space Treaty there doesn’t seem to be a cap for space flight.

Jim said there is no Federal Tort law, it is a state issue. Tort law is “I hurt you, why do I owe you.” He talked about making progress in Virginia. He said it would be hard to change things in California, that California has the longest state constitution.

What do you need to insure against:
1) Third party liability - landing on someone’s favorite cow
2) Loss of informed consent waiver
3) The unexpected - for example getting cancer after taking a space flight

Ralph said that underwriters are basically bookies. He encouraged every company to get insurance. Take some pictures in and resumes. The underwriter you talk with is the person who makes the decision. He predicted that over time the rates will be coming down. He again said best to get an annual deal. The insurance is different for suborbital v. orbital.

First: Introduction
Overview: the agenda
Previous: DoD and ITAR
Next: Jim Muncy on PoliSpace


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