Attorney Ken Feinberg has announced and outlined a plan for compensating victims of General Motors’ ignition-switch defects, and it includes a broader set of criteria than GM has used to determine which crashes are linked to the faulty part. In doing so, it will paint a clearer picture of how many victims were affected beyond the 54 related accidents and 13 fatalities that the automaker currently stands by.
But there is a certain criteria. Perhaps most importantly, is that victims and families of victims need to verify that their vehicle’s airbags did not deploy when the crash happened, which was the tell-tale sign of the car stalling because the key was set into “accessory” mode. On that note, an internal 2012 GM document released last week by a House committee investigating GM’s handling of the safety defect shows that the company counted more than 800 accidents in which airbags did not deploy in certain Chevrolet Cobalts and Saturn Ions.
There’s no limit to the money General Motors will pool aside for the victims. Rather, GM will pay out whatever the total amount of compensation is going to be based on Feinberg’s criteria, which is more specifically outlined at GMignitioncompensation.com. Though people who due file a victim claim for compensation must waive their right to sue, but only after Feinberg has determined their eligibility and payment amount.
On the same token, filers will not be immediately turned away based on “contributory negligence” in the crash. This translates to whether they were speeding, texting, not wearing a seat belt or impaired by drug/alcohol use. Feinberg also stated that victims who already have settled lawsuits against GM for claims from accidents stemming from the ignition switch and signed a release not to sue in the future “can rip up that release” and be included in the compensation program.
The criteria Feinberg will use to calculate payments to the families of these victims will be a formula that relies on the national averages for settlement values of economic and non-economic loss, which also includes pain and suffering. Even economic losses will be calculated based on the victim’s age, salary, historical earnings and dependents.
Non-economic payouts will be $1 million for the person who died, and $300,000 each for the surviving spouse and any dependents.
One example given would be the hypothetical death of a 17-year-old student, living at home, with no dependents. The compensation would be valued at $2.2 million, based on those national settlement averages. Another example is a family of a 25-year-old with two kids and an annual salary of $75,000 would be paid $5.1 million.
The compensation fund will also apply to those who have suffered catastrophic physical injuries, such as those that resulted in the victim being quadriplegic or paraplegic, or suffering permanent brain damage, double amputations or pervasive burns. And in some cases, victims who suffered severe injuries could be given more money than even the families of those who died. One example was a 40-year-old with no children who earns $70,000 a year that was severely injured would receive $6.6 million, based on the national settlement averages.
Victims with less serious physical injuries but still required hospitalization or outpatient medical treatment would be eligible for payments ranging from $20,000 for a one-night stay at a hospital for observation to $500,000 for hospitalization of a month or longer. Eligible victims who were in the hospital eight to 15 days in the wake of an ignition-switch-related accident would be paid $170,000.
In each category, eligible victims can either choose a standard amount, based on the national averages, or they can request “a more tailored, individual award,” by asking Feinberg to consider “extraordinary circumstances.” To that end, Feinberg said “simple” claims will be paid within 90 days, while the more complicated claims will be paid within 180 days. He said he expects to complete the process by sometime in the spring.
Plaintiffs can begin filing claims on August 1, but no later than December 31.