GM refuses 91% of faulty ignition switch claims

© Jeff Kowalsky
General Motors' compensation expert rejected 91 percent of death and injury claims related to faulty ignition switches, which have been linked to 124 deaths – ten times more than GM originally believed –and 275 injuries, 17 of them serious.

Kenneth Feinberg, who has reviewed compensation claims related to the BP oil spill in the Gulf of Mexico and the 9/11 attacks, approved 399 of the 4,343 claims filed with the GM Ignition Compensation Claims Resolution Facility. He was hired by GM to advise the company how to respond to accident claims involving defective ignition switches.

The 91 percent of claims Feinberg rejected “couldn’t support any connection to the ignition switch," according to Camille Biros, deputy administrator of the fund. Some of those refused claims were related to cars not part of the recall or air bags that had inflated during a crash, meaning ignition switches were not to blame, she said Monday, according to the Associated Press.

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Of the 399 eligible claims, 124 were deaths and 17 were victims that suffered serious injury, including quadriplegia, paraplegia, double amputation, permanent brain damage, or pervasive burns. The other 258 claims were for people with injuries that resulted in hospitalization or outpatient treatment within 48 hours of the accident.

Of the approved claims, 325 have been accepted, eight refused, and 65 have not been finalized, according to the Associated Press. Claimants offered an award could decide to take the money, refuse it, or possibly sue. Those rejected could also decide to sue.

GM has designated $625 million to pay victims of the bad switches. Death claims are eligible to receive $1 million in compensation for the deceased and $300,000 for a surviving spouse or any dependents. Compensation will vary for victims with serious injuries, though they could be awarded more than some death claims, Automotive News reported. Those with more minor injures may receive between $20,000 and $500,000 based on how long they were required to stay in the hospital.

The February 2014 recall involved 2.6 million of GM's small cars, including the 2003 to 2007 model year Chevrolet Cobalt, Chevrolet HHR, Saturn Ion, Saturn Sky, Pontiac G5, and Pontiac Solstice. More model years were eventually added to the recall, which was related to defective ignition switches that could fall out of the "run" or "on" position under certain circumstances, cutting electricity to the engine and power steering, according to GM.

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If the ignition switch is not in the run position, it is possible that airbags would not deploy in case of a crash, according to the findings of a National Highway Traffic Safety Administration investigation.

With the ignition switch claims process in its final chapter, GM is now waiting for the US Department of Justice to decide whether it will levy criminal charges against the company for its failure to disclose the issue and recall pertinent cars when its workers discovered the switch problems in 2001.

GM began 2015 with three safety recalls related to 83,572 sport-utility vehicles and pickup trucks. In July, GM also recalled 780,000 SUV models based on liftgate defects. In the past week, GM announced a recall of more than 73,000 2010 Cobalts given the driver's side curtain airbag is not reliable in a crash, while expanding a headlight recall for 180,000 Buicks and Pontiacs.