Key Bridge case: $350M insurer settlement reached, trial moves forward

ACE American Insurance Co. has reached a $350 million settlement with the owner and operator of the cargo ship that crashed into the Francis Scott Key Bridge, resolving a major insurance claim while leaving the broader, multibillion-dollar legal fight intact.

The agreement with Grace Ocean Private Ltd. and Synergy Marine Group, reached in Baltimore federal court Thursday, matches the amount ACE paid to Maryland shortly after the March 2024 collapse — the full limit of the state’s bridge insurance policy. The deal reflects a standard move, in which an insurer seeks to recover what it paid out.

The Baltimore Sun reached out to all the parties involved, but had not heard back by press time. In court documents, there were no details about the structure of the settlement.

The agreement largely resolves ACE’s effort to recoup its $350 million payout. It does not, however, settle the sweeping litigation that remains, including claims by the state of Maryland, the city of Baltimore, victims’ families and businesses affected by the collapse. Total damages are expected to exceed $5 billion.

Maryland, which received the insurance payout, is still pursuing additional claims against the Singapore-based companies to recover losses beyond the policy limit. Under standard practice, insured parties can continue to seek damages that exceed what insurers have already paid.

The settlement is also separate from a prior $102 million agreement between the ship’s owners and the U.S. government.

Attention now turns to a high-stakes federal bench trial scheduled to begin June 1 before U.S. District Judge James Bredar, who has instructed all parties to be ready after months of discovery and delays.

Focus of the upcoming case

At the center of the case is whether the ship’s owner and manager can limit their liability under the Limitation of Liability Act of 1851, a centuries-old statute that could cap damages at roughly $44 million — a small fraction of the cost to rebuild the bridge and compensate victims.

Grace Ocean and Synergy Marine argue the crash was caused by an unforeseeable mechanical or electrical failure aboard the Dali, not negligence. Plaintiffs, including Maryland, are expected to counter that the companies knew or should have known about conditions that led to the disaster, which killed six roadworkers and disrupted a major East Coast shipping corridor.

If the court finds the companies had such “privity or knowledge,” the liability cap would be lifted, potentially exposing them to billions in damages. The trial is expected to hinge on technical evidence, including the ship’s power systems, maintenance records and crew actions in the moments before the collision.

Have a news tip? Contact Brian Carlton at bcarlton@baltsun.com. 

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