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Most commercial satellites are insured in case something happens on launch. Although the Ariane 5 is a fairly reliable rocket, a launch failure is not out of the question.

While other questions have said that if the JWST fails to deploy it's basically SOL and I would assume uninsurable, rocket launches are regularly insured. Is the JWST insured against the failure of the Ariane 5?

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    $\begingroup$ @jamesqf True but realistically Congress isn't going to fund a second attempt. $\endgroup$ – Rob Rose Feb 1 '18 at 19:45
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    $\begingroup$ Why would a publicly funded organization care? Just taxpayer money... $\endgroup$ – Wyrmwood Feb 1 '18 at 20:14
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    $\begingroup$ @Wyrmwood because they want the valuable science and know they likely won't get funding for it again? $\endgroup$ – Rob Rose Feb 1 '18 at 20:57
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    $\begingroup$ @Wyrmwood That's not deceptive math. Those two values have different meanings. The latter divides out the total cost of the entire Shuttle program over the number of launches, the former is the estimated cost merely to launch a Shuttle (not including the non-recurring costs necessary to support the infrastructure of the Shuttle program). $\endgroup$ – called2voyage Feb 1 '18 at 21:26
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    $\begingroup$ @Wyrmwood Also, 1.5B is still a drop in the bucket--see jamesqf's comment above. $\endgroup$ – called2voyage Feb 1 '18 at 21:27
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NASA tends not to insure its missions, nor do any government missions. These missions are one-of-a-kind, and so expensive that the satellite insurance market would have a hard time making it work. They simply triple-check everything they can, and expect to lose a few missions, so called "Self-insurance". They have considered insuring things like the ISS before, but it's never worked out.

Just to give you an idea, the cost of insurance is about 10-15% of the insurance amount for the space market. The success rate of Space Shuttle launches was 99%. Since 2000, there has been 19 successful NASA interplanetary mission launches, and 1 failure (CONTOUR).

Basically, it would cost NASA more to insure the missions then the benefit it would gain from insurance, and thus they have chosen not to insure their missions.

Furthermore, the requirements tend to change for missions over time. It might take another 4 years to re-build the spacecraft, and another year or two waiting for the right opportunity to launch. In that length of time, things will have changed considerably.

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    $\begingroup$ @RobRose With the turnaround time on most of these missions, by the time it has failed, it has usually been so long you don't want to repeat the same mission. $\endgroup$ – called2voyage Feb 1 '18 at 16:54
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    $\begingroup$ If a lot of missions are done, self-insurance will be cheaper. Of course everything of the mission should be done very carefully. $\endgroup$ – Uwe Feb 1 '18 at 16:58
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    $\begingroup$ NASA doesn't know how to do missions that aren't done very carefully. They do occasionally make mistakes, but not that many... $\endgroup$ – PearsonArtPhoto Feb 1 '18 at 17:02
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    $\begingroup$ @RobRose The risky part is putting spacecraft that cost multiple billions and took person centuries of work (and whose successful launch is critical to many people's careers) on top of a giant firework. However, that risk is unavoidable. Buying insurance vs "self-insurance" is a bookkeeping decision, it doesn't reduce the risk at all. $\endgroup$ – djr Feb 1 '18 at 19:42
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    $\begingroup$ I would add that NASA is not a for-profit corporation. They don't expect to make a profit from JWST, Hubble, the ISS, a mars rover, etc. The reason you insure a satellite is to recover your lost investment so you can then decide to a) try again or b) do something else. NASA doesn't work that way because they are part of the US government with a budget set by congress. Much more important is the prestige they gain from launches. A successful launch, they keep their budget. A failure, heads roll. There is no insurance to protect the prestige lost in a failure $\endgroup$ – gillonba Feb 1 '18 at 22:42
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Insurance is done when losing a mission would mean an unacceptable financial loss, e.g. when a launch failure would bankrupt your company. The government is large enough to absorb such losses, so no insurance is necessary.

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  • $\begingroup$ There's an interesting parallel in automotive insurance (USA). In states that require proof of insurance to drive; if you, on a yearly basis, have over X dollars saved away (usually X is > $100,000) you can be 'self-insured' for automotive accidents with proof provided and verified by the BMV. This must be updated yearly to prove you still have the required amount saved. Same idea though, wealthy individuals can take a hit instead of shelling out money for something that may or may not happen, then be extra careful. $\endgroup$ – Magic Octopus Urn Jul 11 '18 at 20:30

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