Insurance Coverage of Meteorite, Asteroid and Comet Impacts — Issues and Options

Abstract

An asteroid or comet will threaten a major urban center sometime in the future. It is very unlikely to happen this year, but some day it will happen. The potential damage will be catastrophic. A typical property insurance policy promises coverage for damage caused by such an impact, but there are limits to the capacity of insurance to pay. Moreover, damage from an asteroid or comet strike in a major urban center does not fit the principles of insurance coverage, so insurers may use the months or years between detection and impact to exclude this peril in insurance policy renewals that take place before the strike occurs. National and international policy makers should develop preparedness plans assuming that they will manage society’s recovery from an asteroid or comet strike in a major urban center, including responsibility for financial matters.