Thank you, Kevin, for that kind introduction. Good morning everyone, and welcome to the U.S. Department of Commerce.

We appreciate your being here for the second in a series of summits we are hosting as we seek to build the space industry from its current level of $400 billion, to a trillion dollars.

The first event last December focused on new opportunities for financial investment in the space sector. At that gathering, we addressed the need for more diverse financing, and the different ways in which Wall Street can fund growth opportunities offered by the emerging commercial space economy.

One of the main concerns for big banks is the amount of risk involved in this largely unregulated operating environment. The other big concern is how long it takes to transform a new development into a revenue producer, and the amount of capital that is totally at risk. These are being addressed by industry players.

As you know, 600,000 objects careen around the Earth at over 17,000 miles per hour. At these speeds, even a small paint chip can cause catastrophic damage to vital communications, weather, or GPS satellites, mainly by damaging the fragile solar panels. Such dangers also threaten human life in space, public safety, and our national security. We know the dire implications of potential conjunctions. Most of the debris currently in space is the result of only a couple of catastrophic events or from the physical degradation of satellites as they age.

As we become more able to track objects smaller than 10 centimeters in diameter, and launch companies continue to lower costs and make space more accessible, the seemingly vast emptiness of space will get even more crowded.

The number of satellites currently orbiting the planet is 1,500, with 800 — more than half — being U.S. satellites. In just a few years, the United States alone is expected to have 15,000 satellites in orbit. This is exciting. It is a big, growing market.

But it adds more risk — more uncertainty — and creates a growing need for some rules of the road. One wrong move by an operator could result in a celestial pinball game of epic proportions. I say this not to create a feeling of doom and gloom, but to motivate everyone to proactively identify solutions — or pathways to solutions — as we prepare for the exciting activities to come in space.

Today’s event focuses on the topic of risk, and the potential means of risk mitigation. But the discussion also needs to include data collection, origination, presentation, and analysis.

Another area is that of humans in suborbital and orbital space, and the risks and opportunities related to them being there. There are also additional issues relating to the fact that space is a multi-national activity involving more than 70 countries, and that, in turn, raises issues about regulatory concepts. These issues were raised earlier at breakfast. But today, we will be hearing from expert panelists mainly on two connected areas of interest: space situational awareness; and space insurance.

Space situational awareness — or SSA — data and space traffic management services — or STM — will play a significant role in driving the space economy towards the trillion-dollar mark. However, we will not achieve a trillion-dollar industry without corresponding business solutions that address risk in the space environment. This is where space insurance comes into play.

Just last week, OneWeb launched the first six satellites of its planned constellation of 650 for global Internet connectivity. At the end of last year, SpaceX launched 64 U.S. cube-sats at one time — a small-satellite U.S. launch record. As the skies begin to fill with more objects, the risk of collision increases.

President Trump recognized the need for increased space situational awareness when he signed Space Policy Directive-3, the nation’s first space traffic management policy. This Space Policy Directive designates the Department of Commerce as the lead agency for providing basic SSA data and services to the commercial sector. This would include greatly increasing the quality and accuracy of warnings or other events.

We want to encourage the development of an open market for commercial SSA services that adds value to the basic SSA data provided by DoD. There is an inherent demand for such services among satellite spacecraft operators: It is in their self-interest to reduce the risk of losses by having a safe space environment.

SSA and STM impact every corner of the space economy. SSA allows for higher fidelity in risk assessment and management. Larger quantities of more accurate and more detailed data will form the basis for algorithms that are more sophisticated.  This, in turn, supports tailored insurance products that can meet the unique needs of the innovative space community.

More and more, space companies are seeking insurance products that address the specific technical and business needs of innovative space systems. But no two space companies are alike. All of the companies in the commercial space industry require unique business- and risk-mitigation solutions to deal with the space debris and space congestion problems.

Traditionally, space insurance has been limited to protecting against the total loss of a space asset, usually during the first few minutes of launch. But with emerging large satellite constellations, the loss of a single satellite becomes less significant in and of itself.

Going forward, large satellite systems will need insurance that covers the partial loss of an entire system. Such coverage requires different calculations that take into account the loss, or partial loss, of both services and hardware.

I hope that today’s meeting explores how actuaries can apply SSA data to their risk calculations, and what improvements would be needed in the data inputs. By doing so, the space insurance industry may stimulate greater participation in SSA data and STM services.

SSA and STM are not problems that we will fix overnight, and orbital debris standards and best practices are things that should not be regimented hastily, or rigidly. As technology evolves, so should the factors — as well as the regulatory environment.

There will also be a growing need for capturing and eliminating the space debris, another potentially viable business opportunity. I am confident that we have the right people on our team to address these challenges and take important steps forward. And, working with our expert friends at NASA, DOT, STATE, and the rest of the inter-agency, the future looks bright!

Most importantly, we will lean heavily on the people in this room — industry leaders, and pioneers in the next frontier of business. We have a lot to talk about today.

Car insurance companies offer favorable rates if you maintain a good driving record, and even better rates if you install a device in your car that provides situational awareness to the insurer in real time. How does this model apply to space operations? Is no-fault insurance a solution? And can the insurance industry incentivize active debris removal services that reduce risk for the entire population of active satellites?

Beyond SSA and STM, what can the insurance industry do to limit and quantify risk in space operations for emerging ventures seeking capital investment? And can insurance play a larger role in the space economy as we move towards ever more innovative activities, such as space tourism, asteroid mining, and satellite servicing? These are the types of questions I hope we can address before we adjourn this afternoon.

With opportunity comes risk. The emerging space industry will depend more and more on your expertise in order to manage that risk and ensure its success.

Thank you all for coming today and participating in this event, as well as for all you are doing to grow the American commercial space economy. I hope you find today productive.  Our Office of Space Commerce and I look forward to working with you in the future. Thank you.