After PSLV-C62 Failure, India Faces Tough Question: Are Satellites Insured?

The failure of the PSLV-C62 mission has done more than wipe out a set of experimental satellites. It has exposed a structural weakness in India’s rapidly expanding private space ecosystem — the absence of a mature, reliable space insurance framework.

Several private startups lost satellites worth millions of dollars when the mission failed. For some companies, the loss represented years of engineering work vanishing within minutes. For others, it was a calculated risk — uninsured technology demonstration payloads flown to validate concepts rather than generate revenue. While such practices are not uncommon globally during early stages of innovation, the scale and frequency of private participation in India’s space programme are now forcing a difficult reckoning.

As India moves from a government-dominated space model to a mixed public-private ecosystem, PSLV-C62 has reignited a crucial question: can India financially absorb repeated launch failures as commercial activity accelerates?

Space missions, by nature, carry extreme risk. Launch vehicles can fail, satellites can malfunction, and debris can damage other spacecraft in orbit. In mature space economies, insurance acts as the financial safety net that allows companies to innovate without risking complete collapse. In India, that safety net remains fragile and underdeveloped.

Space insurance typically spans multiple stages — covering pre-launch manufacturing and transport, launch and early orbit phases, in-orbit operations, and third-party liability. Globally, launch and early-orbit insurance alone can cost between 5 and 20 percent of a mission’s total value, making it one of the most expensive forms of insurance. Third-party liability coverage is even more critical, as international treaties hold the launching state responsible for any damage caused by space objects.

This legal reality makes insurance unavoidable at scale. If an Indian satellite were to collide with or damage another country’s spacecraft, or if debris were to cause harm on Earth, the financial liability could be enormous — and would ultimately fall on the Indian government in the absence of mandatory coverage.

In the PSLV-C62 mission, several private payloads, including experimental refuelling and technology-demonstration satellites, were flown without insurance. For early-stage startups, this decision is often driven by economics. Insurance premiums can exceed the actual cost of building small satellites, particularly when technologies are too experimental for insurers to accurately price risk.

However, industry voices increasingly view PSLV-C62 as a turning point. As Indian startups move into advanced domains such as in-orbit servicing, satellite refuelling, and life-extension technologies, the lack of scalable insurance frameworks becomes a bottleneck rather than a choice.

Awareness of space insurance exists in India, but experience remains limited. Historically, failures were absorbed by the state because space activity was led almost entirely by public agencies. That model is now outdated. Private launch companies, satellite operators and service providers are entering the market faster than regulatory and insurance systems are evolving.

Unlike the US and Europe, India still lacks a comprehensive national space law that clearly defines insurance mandates, liability caps and indemnification rules — all essential inputs for insurers to price risk. Without clarity, insurers remain cautious and startups are left exposed.

Globally, different models exist. The US mandates third-party liability insurance while allowing companies to self-insure mission losses. Europe relies on established insurance markets to absorb large-scale failures. Japan actively encouraged domestic insurers, allowing startups to recover financially even after mission failures.

India now stands at a similar crossroads.

As commercial missions transition from experimental to revenue-generating, insurance will become a prerequisite for investment, financing and customer trust. PSLV-C62 may ultimately be remembered not just for the satellites lost in orbit, but for forcing India’s space sector to confront a long-delayed reality: ambition without financial protection is no longer sustainable.