"If one of these folks can't get a $1 million in coverage or can't prove it, then they are really not a commercially viable entity and they are not someone that you should be doing business with or buying spacecraft components from," said Vargas.
The insurance also helps guarantee that people will be compensated in the few instances that damage lawsuits are allowed, he said.
Virgin Galactic, state economic development officials and Spaceport America Executive Director Christine Anderson have blamed New Mexico's refusal during the last two legislative sessions to expand the liability protections as the reason some commercial space companies have gone to states such as Texas and Florida. However, companies have pointed to lucrative economic development incentives from other states as a factor in their decisions.
Republican Gov. Susana Martinez said Wednesday she hadn't seen the proposed compromise but hoped it will keep Virgin Galactic as the anchor tenant for New Mexico's spaceport. Before pledging support for the measure, Martinez said, she wants to analyze the legislation and make certain it won't discourage other space companies from coming to the state.
"It's encouraging that there is discussion," Martinez said during a public appearance in Albuquerque. "I want to read it first."
Associated Press Writers Russell Contreras and Jeri Clausing in Albuquerque contributed to this report.
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