Liberty Syndicates is to provide $250m of capacity to cover the operators of communications satellites.
It has also formed a partnership with modelling company Sciemus to understand satellite risk and their reliability.
Liberty said it intends, through a consortium, to increase capacity to $400m over the next few years.
Sean Dalton, Liberty chief executive, said: "This represents the largest single source of new capacity made to the industry, which hitherto has suffered from an inability to differentiate between good and bad operators.
"The model will enable differentiation between good and bad risk within the satellite sector and price to reflect the risk. Operators will be able to see the benefit in terms of significant cost savings and certainty."
Brokers to the consortium are Benfield and HSBC Insurance Brokers.
The space market, since its formation in 1965, has grown to an estimated capacity of $490m for launch risks and $310m for in-orbit risks for 2006.