National Air Cargo, insurer sue over Afghanistan military air crash

NATIONAL Air Cargo and its insurer, Commerce & Industry Insurance Co, are suing the US for breach of contract, saying the government failed to provide reimbursement of as much as US$45 million for the crash of a Boeing 747-400 on a military mission in Afghanistan that killed seven crewmen.

In their complaint in the US Court of Federal Claims in Washington, the two parties alleged that the Federal Aviation Administration (FAA) improperly denied a claim to pay out on an insurance policy covering aircraft contractors working for the Defence Department in a hostile setting.

The insurance policy requires that the FAA "shall make prompt payment in full of any claim covered by the policy after confirmation of loss," the companies said in the complaint.

FAA spokeswoman Laura Brown said in an e-mail that the agency doesn't comment on pending litigation, according to Bloomberg.

Commerce & Industry Insurance paid National Air Cargo and its lenders about $42 million to settle a claim for the loss of the plane, according to the suit. The plane involved in the crash was working under a National Air Cargo contract with the US Transportation Command.

The accident on April 29 near Bagram Airfield, the US Air Force Base was captured on the dashboard-mounted camera of a nearby vehicle and posted on YouTube. The Bagram crash was the fourth fatal accident involving a US-registered cargo hauler since 2009, according to the National Transportation Safety Board.

In August, the estates of three pilots killed in the crash sued Boeing Co in state court in Illinois, alleging negligent conversion of the plane from passenger to cargo use.