The Commercial Spaceflight Federation (CSF) is the trade association of the commercial spaceflight industry. Much of its membership consists of those companies that are thought of as entrepreneurial start-ups that are trying to advance commercial space activities.
The list includes Bigalow Aerospace, Blue Origin, Masten Space Systems, Planetary Resources and XCOR Aerospace. In addition there are several commercial spaceport members including Mojave Spaceport, Spaceport America and Virginia Commercial Space Flight Authority.
One of the ongoing activities of CSF is lobbying for the reauthorization of the U.S. Commercial Space Launch Competiveness Act (CSLA). CSF recently pointed out that when the CSLA was last updated in 2004, it incentivized high levels of investment, innovation and economic growth in commercial space flight activities. The new legislation (H.R. 2262) will allow continued growth and expansion of this industry.
The U.S. Government Accountability Office (GAO), in its 2012 release GAO-12-767T, entitled: "Commercial Space Launch Act – Preliminary Information on Issues to Consider for Reauthorization," addressed the sensitive issue of indemnification for third party losses. In its testimony before a House subcommittee the GAO indicated that the U.S provides less indemnification for third party losses than China, France, and Russia.
These countries put no limit on the amount of government indemnification coverage, while the CSLA provides for about $2.7 billion per launch. According to historical records, such a commitment to pay has never been tested, because there has never been a third party claim exceeding a launch company's insurance.
Thus, the potential cost to the government of indemnification for third party losses is currently unclear.
Insurance industry officials and risk modeling experts have indicated FAA's method for estimating probable losses from a rare catastrophic event are outdated. An inaccurate calculation that understates the amount of insurance a launch provider must obtain would increase the likelihood of costs to the federal government, whereas a calculation that overstates the amount of insurance would decrease the likelihood of federal costs.
The insurance market is generally able to provide up to $500 million per launch as coverage for third party liability. The FAA required insurance for launch providers averages about $99 million per launch, and coverage available through CSLA is about $2.7 billion above that.
If the CSLA indemnification were to be eliminated, this may lead to higher prices for U.S. launch provider services, making them less competitive than foreign launch companies.
