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GM makes first Payment Offers from Compensation Fund

GM makes first Payment Offers from Compensation Fund

September 26, 2014

Earlier this week, about 15 claimants were offered the very first cash payments to come from the General Motors compensation fund. This fund has been set up to compensate victims of auto accidents caused by faulty ignition switches in certain recalled GM vehicles. Among those offered settlements were the families of Natasha Weigel, 18, and Amy Rademaker, 15, who were both killed because of a crash attributed to a defective ignition switch.

The compensation fund was set up for victims of injury or families of people killed as a result of the ignition switches. Earlier this year, GM recalled 2.6 million vehicles, including Chevrolet Cobalts, Saturn Ions and other models, because it was found that a defect in the ignition switch could cause the engine to turn off, which can essentially turn off the brakes, air bags and power steering.

Attorney Ken Feinberg is the compensation expert who has been put in charge of settling with the victims. Feinberg decides who is eligible for a cash offer and in what amount. He performed the same function in settlements related to the 9/11 attack and the BP oil spill.

Claims made to the compensation fund will continue to mount. As of this past Wednesday, there were 850 total claims, some of which were made for deaths and others for injury. When a claimant accepts an offer from the fund, then they must agree to bring any future claims against GM.