The U.S. Federal Aviation Administration (FAA) has mandated Elon Musk’s SpaceX to obtain insurance up to five times higher than in previous years, before being given a license to launch his new Falcon 9 rocket, the Wall Street Journal reported.
Under the FAA’s new liability coverage mandate SpaceX is now required to obtain insurance of around $63 million, apparently over concerns of damage to surrounding government property, although exact reasons for the price hike remain unclear.
Previously the cover required for similar rocket launches was at just $13 million.
Earlier this week the company launched its second Falcon 9 mission from its Florida space centre, after receiving its FAA license for its Falcon 9 rockets, which was issued for March 1st.
SpaceX has grand ambitions for transforming space tourism and transport, but it suffered a considerable set back last year after two of its Falcon 9 rockets exploded, forcing the company to reschedule its planned unmanned mission to Mars from 2018 to 2020.
And with goals like establishing large-scale human settlements on Mars, SpaceX continues to rewrite the impossible for the space exploration industry, and as can be seen with FAA’s recent insurance mandate, as this sector grows, fledging requirements for reinsurance have potential to grow into a flourishing new reinsurance space.