Air France, Insurers Sue Continental

September 28, 2000

Air France and La Réunion Aérienne (LRA), the consortium of insurers that covered the Concorde, that crashed outside of Paris on July 25th, killing all aboard, have filed suit in a French Commercial Court against Continental Airlines for reimbursement of all damages caused by the crash.

LRA, which includes Generali, Groupama, CGU-France and Mutuelles du Mans, insured 50 percent of the loss. AGF and AXA share the remaining exposure with 30 and 20 percent respectively.

Under The French Aviation Code an airline is responsible for any damages caused by pieces which fall off the aircraft. The suit, filed in Pontoise outside Paris, seeks reimbursement under this provision for any damages incurred.

As previously reported, preliminary reports have indicated that a piece of metal, ejected from a Continental Airlines DC-10 that took off shortly before the doomed Concorde, appears to have been the cause of the burst tire, which led to the crash.

LRA and the other insurers have already paid a $30 million claim for the hull loss of the aircraft, but may be liable for a great deal more in personal injury claims. Some estimates have gone as high as $300 million, which, if the cases are decided in the U.S., are not unrealistic.

The French Court would then have to decide if Continental is liable to reimburse these damage awards.

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