How GM will pay its victims millions of dollars affected by faulty cars

General Motors announced Monday it's planning to fork out millions of dollars to victims and families who were affected by the company's faulty ignition switches in some of its cars. 

"The company's CEO, Mary Barra, says there will be not be a cap on payments. GM says there were at least 54 crashes related to this. Thirteen deaths linked to those faulty switches." (ViaWLTX)

News broke earlier this year that the company knew about the faulty ignition switches for more than a decade. The fault can cause cars to shut off while driving — disabling anti-lock brakes, power steering and even air bags. 

GM hired prominent compensation attorney Kenneth Feinberg to lay out the plan and allocate the funding. (Via Wikimedia Commons / Samuel Wantman)   

Again, there is no compensation cap — however, there are three categories for victims, and these will help determine how much money will be handed out in each case. The first is eligible death claims; second, eligible catastrophic injuries such as burns or quadriplegia; and lastly, less severe injuries that required medical treatment within 48 hours of the accident. (Via General Motors

The program is entirely voluntary — and as long as the vehicle involved in the incident was faulty, a claim can be filed. But if victims and their families decide to settle with GM, they cannot sue the company in the future. 

FEINBERG: "If it's an eligible vehicle, the air bag did not deploy with the driver, passenger, pedestrian, occupant of another vehicle where the air bag might have deployed." (Via CNN)

The company is only looking at how the faulty cars played a role and is not considering "contributory negligence," which would include things like texting, speeding or drinking and driving. (Via General Motors

The issue has really taken a monetary toll on the company. In May, GM was ordered to pay $35 million to federal auto safety regulators — the maximum allowed by law. A number of lawsuits have also been filed against the company by victims, shareholder and other GM vehicle drivers.

GM began recalling vehicles in February. ​The Washington Post notes the company has issued over 54 recalls this year. More than 28 million vehicles were involved in those recalls worldwide.

Those numbers included recalls an additional 8.45 million recalls announced Monday. (Via The Wall Street Journal)

FEINBERG: "Money is a pretty poor substitute for loss. It's the limits of what we can do, unfortunately. We can't bring people back; we can't restore limbs. It's the best we can do."(Via MSNBC)

The fund will begin accepting claims Aug. 1. GM also noted people who have already come to a settlement with GM may also file for the compensation package.  

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