Trillion-yuan Blue Ocean Takes Off! In the Commercial Space 2.0 Era, How Can the Insurance Industry "Reach for the Stars"?

How can AI and the shared risk pool model improve underwriting capabilities for high-risk projects?

By Daily Economic News Reporter: Tu Yinghao Edited by Liao Dan

The era of China Commercial Space 2.0 has begun! By December 2025, more than 90,000 Chinese companies related to commercial space will be in operation. Represented by “China Star Network” and “Qianfan Constellation,” over ten thousand low Earth orbit satellite internet constellations are accelerating network deployment, creating a massive demand for scalable transportation capacity.

At the industry positioning level, the 2026 government work report designates aerospace as a new pillar industry. With policy support, the rapid development of the commercial space industry urgently requires the insurance sector to provide comprehensive, full-lifecycle protection services, leveraging financial strength to ensure high-quality growth of the industry.

What are the specific insurance needs in the commercial space sector, and how will the insurance industry embrace opportunities and face challenges? A relevant executive from Ping An Property & Casualty Insurance recently told the Daily Economic News that the domestic commercial space industry is currently experiencing a golden growth period with an annual compound growth rate exceeding 25%. Insurance demand is expected to grow explosively, especially for customized insurance products targeting large-scale constellation networking and commercial crewed spaceflight, which will become new growth drivers.

Trillion-level Industry: Significant Gaps in Coverage

Currently, China’s commercial space industry has reached a trillion-yuan scale, with an annual compound growth rate exceeding 25%, entering a golden development period. The insurance industry has also established a basic protection system for commercial space enterprises.

At present, insurance can provide three core types of coverage for commercial space companies: first, asset loss coverage, including accidental damage to physical assets like rockets and satellites during R&D, testing, launch, and in-orbit operation; second, liability risk coverage, including third-party damage during launch, signal interference, or debris fall during satellite operation; third, contract performance coverage, such as risks of breach of contract due to supply chain disruptions or launch delays.

Although a preliminary protection system has been established, the commercial space insurance market still lags behind in development. Industry data shows that current space insurance premiums amount to only about 800 million yuan, with severely insufficient coverage and low demand satisfaction. There are still multiple rigid coverage gaps across the entire chain.

Insiders point out that the main gaps are in four areas: first, testing risks and prototype losses during R&D are not widely covered; second, insured amounts during launch and in-orbit phases are often below actual asset values, especially for high-value satellites and constellation projects; third, third-party liability insurance has high premiums, leading to low corporate willingness to insure; fourth, indirect risks such as supply chain disruptions and revenue losses lack coverage. From R&D, manufacturing, launch, in-orbit operation to third-party liability, rigid gaps remain, such as risks of key component supply interruptions and early satellite decommissioning.

On the top-level design front, in November 2025, the National Space Administration established a new Commercial Space Department. In the same month, the “National Space Administration’s Action Plan for Promoting High-Quality and Safe Development of Commercial Space (2025–2027)” proposed establishing a mandatory insurance system for commercial space activities, bringing policy support to fill coverage gaps and expand insurance coverage.

High-Risk Sector: Challenges in Risk Pricing

Space insurance features the “three highs”: high coverage amounts, high value, and high risk. The characteristics of the commercial space industry pose multiple industry challenges for the insurance sector, becoming significant obstacles to developing space insurance business.

Specifically, industry insiders note that rapid technological iteration in commercial space makes risk assessment difficult, with limited historical data affecting pricing accuracy; the “high coverage, high payout” risk limits the capacity of individual insurers; and fluctuations in the international reinsurance market may transmit to the domestic market.

To address the issues of low insured amounts and high premiums in commercial space insurance, a relevant Ping An Property & Casualty executive stated that the key to solving the “high risk—high cost” dilemma lies in expanding underwriting capacity and optimizing risk pricing. In practice, Ping An adopts several strategies: first, leveraging international reinsurance networks to introduce global underwriting capacity and increase single-project coverage limits; second, using shared risk pools to jointly underwrite with multiple domestic insurers, dispersing risk; third, employing technological tools to reduce risk exposure and lower actual loss probabilities, creating conditions for premium reductions.

In product design, Ping An has launched customized “one enterprise, one plan” solutions that dynamically adjust premiums based on technological maturity and historical launch records. As commercial space launch frequency increases and data accumulates, pricing models will shift from static to dynamic, incorporating machine learning algorithms for precise underwriting.

Notably, establishing shared risk pools for commercial space insurance, integrating multiple underwriting capacities and professional resources, has become a practical path to sustainable development. In March 2025, under the guidance of the Beijing Financial Regulatory Bureau, 17 property insurance institutions, 2 reinsurance companies, and 1 insurance intermediary in Beijing jointly formed the country’s first commercial space insurance shared risk pool—the “Beijing Commercial Space Insurance Pool.” According to data released by the Beijing Financial Regulatory Bureau on December 30, 2025, since its establishment, the pool has provided risk coverage for nearly 7.7 billion yuan across 17 launch projects.

Multi-Dimensional Innovation: Full Lifecycle Coverage

Facing various challenges in this emerging field, the space insurance industry urgently needs to deepen integration with the industry chain, transforming from simple “post-claim” compensation to comprehensive risk management throughout the entire lifecycle.

On March 12, China Ping An announced the industry’s first integrated financial solution combining “insurance protection + capital infusion + capital promotion.” For the full lifecycle risks of commercial space, Ping An Property & Casualty offers insurance coverage spanning “R&D—testing—launch—in-orbit,” covering core risks such as launch failure, in-orbit malfunction, and third-party liability, precisely matching the risk protection needs of commercial space enterprises.

This comprehensive financial solution employs a service model integrating insurance, banking, and securities sectors for seamless, full-chain service. Ping An Bank, relying on the “Nebula IoT Plan,” offers project loans, working capital loans, and employee stock financing; Ping An Securities leverages investment banking expertise to support the full development cycle of innovative enterprises, including IPO guidance on the STAR Market, refinancing, mergers, and acquisitions, with customized “one enterprise, one plan” services tailored to different growth stages. Additionally, Ping An Leasing can support equipment financing.

Industry insiders believe that the healthy development of commercial space insurance depends not only on innovation within insurance institutions but also on a supportive policy framework. Several industry proposals and suggestions have been put forward:

First, establishing national or local space risk compensation funds to cover excessive claims and boost market confidence; second, supporting the formation of industry-wide shared risk pools or consortia to expand underwriting capacity and establishing priority channels for reinsurance; third, building a commercial space risk database by integrating launch data, in-orbit operation data, etc., for more accurate actuarial pricing while strengthening data security; fourth, leveraging the Shanghai International Reinsurance Center to streamline international reinsurance transactions and attract more international capital, enhancing domestic underwriting capacity.

By Daily Economic News