XM Satellite Radio Insurance Claim Denied

XM revealed that its insurers rejected its $400 million claim on the two orbiting satellites its service depends on. The satellites, launched in 2001, were supposed to work for about 17 years, but defects related to their solar panels mean they will only be useful until 2008. Moreover, the malfunctions are forcing the company to take on $320 million in expenses early because XM must now launch its spare satellite next year and pay for a fourth, spare satellite in 2005.

The company says it has enough money to launch the third satellite, but not enough to pay for a new spare unless the insurance settlement comes through or it can find alternative financing.

Read the full article at Washingtonpost.com.

Source: Washingtonpost.com