The report, “Space Risks,” noted how space debris is increasingly becoming a problem for space and satellite insurers as they project billions of dollars worth of damage if the problem is not addressed. Insurance premiums for space risks were close to $800 million in 2011, with losses totaling approximately $600 million.

   AGCS Managing Director Thierry Colliot said that most space debris objects range from used rocket boosters and defunct satellites to lost or damaged space exploration equipment. “Claims could be on the rise as the space around our planet is becoming increasingly congested,” Colliot wrote in the report. “Today, the space debris situation has become irreversible. The number of objects is now so high that it won’t decay on its own through atmospheric drag. Instead, it’s actually increasing as objects collide and produce fragments, which in turn collide in a runaway chain reaction.”

   According to the report, there are approximately 800 satellites orbiting the Earth’s atmosphere, 370 of which are active satellites in GEO orbit and 400 active satellites in LEO orbit.

   Allianz estimates the average insured value of a LEO satellite with an operational lifespan of five years at $40 million, and the insured value of a 15-year GEO satellite at $200 million. The firm also noted that fewer than 30 LEO satellites and 200 GEO satellites were insured in 2011 for a combined worth of more than $20 billion.

   Colliot uses the European Space Agency’s (ESA) Earth observation satellite Envisat as an example of the dangers presented by space debris. ESA lost contact with Envisat in April 2012, but acknowledged that the spacecraft will orbit Earth for another 150 years before burning up upon re-entry into the atmosphere.

   “If [Envisat] were to collide with another object and break apart, the resulting debris cloud would escalate the already serious threat to operating satellites,” said Colliot. “Systematic de-orbiting of new satellites at the end of their lives won’t suffice. An additional 10 major objects would need to be eliminated each year to reduce the debris population to a stable and sustainable level. There are exciting concepts of active debris removal. However, at this stage, because of the high cost involved and technological restraints, we have not yet seen a real breakthrough.”