The end of the NASA space shuttle program spells opportunity for space insurers and brokers as commercial ventures will take astronauts, equipment and even tourists into space.

The 135th and final space shuttle mission launched July 8 from Cape Canaveral, Fla., taking the Atlantis to the International Space Station with its final return to earth scheduled for this week.

While there are few immediate changes for insurers because the shuttle has carried no commercial payloads since the Challenger disaster in 1986, NASA already is funding various commercial launch systems, which should mean more business for insurers, said Simon Clapham, London-based head of the marine division at Liberty Syndicates, a Liberty Mutual Group Inc.-owned Lloyd's of London insurer.

With the retirement of the shuttle, NASA is looking to nurture the commercial U.S. space capability and has awarded contracts to resupply the space station to Hawthorne, Calif.-based Space Exploration Technologies Corp. and Dulles, Va.-based Orbital Sciences Corp. It is also funding the development of other spacecraft systems—including those by Kent, Wash.-based Blue Origin L.L.C., Chicago-based Boeing Co. and Sparks, Nev.-based Sierra Nevada Corp.—to deliver astronauts and cargo into low-earth orbit.

The move is an opportunity for insurers to create new liability products and expand their first-party launch and in-orbit offerings, said Jeff Poliseno, Washington-based chief executive of Aon Risk Solutions' international space brokers practice, a unit of Aon Corp.

The last shuttle mission is the beginning of a new chapter, said Denis Bensoussan, Paris-based space underwriter at Hiscox Ltd. For the first time, a government will use commercial launch vehicles to put cargo and, later, astronauts into space, something that historically was the domain of governments, he said.

While NASA will continue to be largely self-insured, commercial operators carrying astronauts and cargo to the space station will need third-party liability insurance to maintain their commercial space licenses, said Chris Kunstadter, senior vp for space at XL Insurance in New York. They also may buy property and liability insurance to cover their contractual obligations to NASA, he said.

Suborbital commercial ventures, including test flights by SpaceX and Virgin Galactic, a joint venture involving Sir Richard Branson's Virgin Group Ltd., already have purchased third-party liability insurance, said Mr. Kunstadter.

“As the transportation of crew and cargo is turned over to the commercial sector, there will be a requirement for insurance and this will lead to an increase in overall premium for insurers,” he said. “We have been working with commercial space operators and regulators to come up with new insurance products to cover cargo and astronauts delivered into low earth orbit.”

Aon has been working with insurers to provide SpaceX with cover for the Falcon 1 and Falcon 9 launch vehicles. In granting commercial space licenses, the U.S. Federal Aviation Administration requires minimum levels of third-party insurance to cover damage to property and bodily injury on the ground and in space, Mr. Poliseno said.

The FAA sets the minimum level of insurance based on a maximum probable loss, although the U.S. government provides an additional $1.5 billion indemnity, he said.

Coverage already has been provided for nonprofessional astronauts, or space tourists, who have traveled to the space station aboard state-owned Russian Soyuz spacecraft. Now, however, underwriters have the opportunity to develop specific insurance for professional astronauts and space tourists carried by commercial operators, Mr. Bensoussan said.

“Hiscox has been working on a product to insure individual passengers on commercial space flights,” he said. “Virgin Galactic will fly from U.S. states where it can waive a passenger's right to sue. However, it is possible this could be challenged (in the courts), so operators will need to consider contingent passenger liability and personal accident insurances.”

When commercial operators begin ferrying cargo and astronauts to the space station, there is the potential for three to five more insured launches per year atop the current 30, Mr. Bensoussan said. “The opening of space to commercial players is a positive development for insurers because it will mean more launch vehicles, more volume of risks and it will generate business for underwriters,” he said.

“The space insurance market is inherently volatile, so an increased number of launches supplied by a greater number of launch vehicles and that will mean more premium volume and a greater spread of risks, which should reduce volatility,” said Mr. Bensoussan. Annual premium for the market was about $700 million in 2010, according to brokers.

“The development of commercial space systems like SpaceX broadens the client base for insurers and gives more choice to satellite and space operators,” said Mr. Poliseno of Aon, which has represented SpaceX since 2005. There are two main launch options—the European Space Agency's Ariane rocket and the Russian Proton launcher marketed by Reston, Va.-based International Launch Services Inc. for commercial use. The Sea Launch vehicle, also is set to return to flight in the near term.

NASA is unlikely to buy insurance for its ongoing space activities, such as the exploration of Mars, the moon and earth observation. Insurers have had discussions with NASA in the past over the prospect of buying space insurance; however, hurdles in the way the government works have been too difficult to overcome,” said Mr. Kunstadter.

While the U.S. government generally does not buy space insurance, many other countries do, said Jan Schmidt, head of space insurance at Swiss Reinsurance Co. in Zurich.

The Italian government has purchased launch insurance for the military communications satellite SICRAL. The European Galileo navigation satellite, which is government-owned but privately operated, will inquire about launch and in-orbit insurance, Mr. Schmidt said. Other government satellite launches that have purchased insurance include the Chinese weather satellite FengYun, NASA's Tracking and Data Relay Satellite System and Pakistan's Paksat.

In addition, there are many partnerships between state-owned agencies and commercial space ventures in Europe and Asia, Mr. Schmidt said.

The European Aeronautic Defense & Space Co. and ND SatCom GmbH have won a contract to supply German armed forces with satellite communications. Such ventures generate premium for space insurers, although they pose a significant challenge where confidentiality can prevent insurers from performing the required risk analysis. In the case of ND SatCom, the launch and in-orbit operations were insured, he said.

Insurance also is being seen as a viable option to protect publicly funded space ventures, he said. “There is a growing realization by governments of the value of insurance as they become more responsible with taxpayers' money,” Mr. Schmidt said.