The nurse was the only passenger aboard the Beechcraft Baron aircraft when it crashed about 800 metres from the runway at Kununurra Airport, in far-north Western Australia, in April 2022.
The pilot was able to free himself and the passenger but the nurse, aged in his 50s, later succumbed to his injuries.
A preliminary investigation found the cockpit fire had started on approach to the runway and obscured the pilot's view of his controls.
In its final report released on Tuesday, the Australian Transport Safety Bureau found that a fault associated with the landing gear electrical system had likely ignited fuel from the cabin heater supply line.
Chief Commissioner Angus Mitchell said the fuel line to the aircraft's cabin heater passed through the area where the pilot reported the fire initiated, and multiple lines of electrical wiring passed through that area as well.
"The fire coincided with multiple unusual indications and a burning smell as the pilot attempted to extend the landing gear."
The pilot managed to suppress the blaze with a fire extinguisher but it "returned vigorously", the report said.
Within 90 seconds of the pilot making an urgent radio broadcast, the plane crashed.
The pilot sustained serious burns and both he and the passenger suffered respiratory injuries.
Investigators identified four other crashes in Australia and the United States involving in-flight fires on Beechcraft Baron planes, with damaged wiring identified as a likely factor in three of the cases.
The bureau last year issued a safety advisory notice, urging Baron owners to inspect the aircraft's heater fuel line and ensure electrical wiring is not rubbing and chafing against it.
"Damaged electrical wiring can pose a range of hazards to the safety of flight, including loss of electrical power, malfunctioning systems, and in-flight fire," Mr Mitchell said.
"This hazard is further increased when wiring is proximal to lines carrying flammable liquid.
"Maintenance organisations and operators should review current practices for the prevention of damage to wiring and ensure that all available steps are being taken."
The report found the passenger's chances of survival may have increased had he been wearing the same four-point harness fitted across both shoulders that was worn by the pilot, instead of a three-point harness.
"Four-point restraints, where available, provide increased survivability," Mr Mitchell said.
"And where available and practical, rearward-facing passenger seats improve frontal impact protection and survivability in an accident."
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