The problem stems from faulty ignitions in several models of GM cars from the 2005-2012 model years. The ignitions could be jolted into “accessory” or “off” position while the car was running and turn off the power steering and, crucially, airbag deployment in a collision.
GM has admitted knowing of the problem for more than a decade before launching a recall of 2.6 million Chevrolet Cobalt, Saturn Ion and other cars in February.
The company is under both federal criminal and congressional investigations for hiding the problem for years.
In the base plan announced by Feinberg on Monday, for each eligible death claim, in addition to the minimum $1 million for the victim, $300,000 will be awarded for the surviving spouse and another $300,000 for each of the victim’s surviving dependents.
Financial and medical treatment compensation of at least $20,000 will also be offered for those with eligible physical injury claims from an accident.
Compensation claims will be taken from August 1 through December 31.
People who were injured, and families of those killed prior to GM’s government-backed bankruptcy reorganization in June 2009, can file claims with the “new” GM. “For accidents, the GM bankruptcy is no bar to filing a claim on this program,” Feinberg said.
He also said that people who had already settled with GM and given away their right to sue can “rip up” the document and receive additional compensation.
But the compensation program does not cover claims for accidents in which an airbag deployed and/or the seatbelt “pretensioner” – the device that removes slack early in a crash – worked.
GM’s chief executive Mary Barra, who took the company’s top job just weeks before the ignition switch recall began, welcomed Feinberg’s plan.
“We are taking responsibility for what has happened by treating them with compassion, decency and fairness,” Barra said in a statement.
“To that end, we are looking forward to Mr. Feinberg handling claims in a fair and expeditious manner.”
