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Life insurance for moon shot was a long shot for astronauts

Sat Sep 8th, 2012 on     Insurance Claims,    

The death of Neil Armstrong late last month seems to have reignited interest in the space program and the lives of the Apollo astronauts. Tributes to Armstrong always included the grainy footage of his first step on the moon, and some recalled the entire Apollo 11 mission, from liftoff in Florida to splash-down and quarantine. Armstrong’s achievements may well inspire a whole new generation of explorers.

There seems to be a standard set of questions about the practical side of space travel that everyone asked astronauts time and time again, and the crews always answered with humor and patience. One detail that most would not think of, though, was left to the insurance nerds of the world: What did the astronauts do about life insurance?

It is hard to imagine that an insurance company would assume the risk of a trip to the moon, much less the risk of being the first men to walk on the moon. And, even if an insurer agreed to cover Armstrong, Buzz Aldrin and Michael Collins, the premiums would have been outrageous.

Someone came up with a substitute for life insurance, a way for the astronauts to make sure their families were taken care of financially if the worst happened. The crew traded in on their fame by creating “insurance covers” that actually had nothing to do with insurance.

In those days — and perhaps now — an astronaut’s most marketable asset was his or her signature. The cachet of the Apollo missions was unparalleled in the ’60s, and the crews’ autographs were in high demand. Associate that autograph to some milestone of the space program, and the value would increase dramatically and continue to increase over time.

So insurance covers came into being, removing life insurance companies from the equation while providing a sense of security to the astronauts’ families. We’ll discuss the covers in more detail in our next post.

Source: Discovery News, “Apollo 11’s Unconventional Life Insurance Policies,” Amy Shira Teitel, Sept. 5, 2012

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