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GM Ignition Switch Compensation Claims Surge To 4,180 With 455 Death Claims

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Claims for the compensation fund established by General Motors for the victims of its ignition switch defects surged to 4,180 in the hours leading to the deadline on Sunday morning.

The cost for the fund, however, is not expected by the embattled car company's officials to go beyond GM's estimate of up to $600 million.

The compensation fund, which was launched in August of last year, was established to pay for legitimate claims made for injuries or fatalities caused by the faulty ignition switches in several GM vehicles. The ignition switches may suddenly turn off the power to a running vehicle's power steering and brakes, along with disabling the air bags.

The fund is the automobile manufacturer's first step in restoring the company's credibility with the public and lawmakers over the mishandled issue regarding the faulty ignition switches in their vehicles.

A fund administrator, however, said that the total number of reported claims could still increase as some claims may have been mailed rather than submitted electronically. Of the 4,180 claims received so far, 455 are death claims.

The confirmed number of deaths caused by the faulty ignition switches increased by one to 51 and the number of seriously injured increase by two to 77. The initial estimate of GM was that there were only 13 fatalities associated to the faulty ignition switches.

The injury and fatality figures are also expected to increase as more claims undergo evaluation by the compensation fund administrators. People who accepted payouts from the compensation fund are required to waive all their rights to sue against the car company.

Payments from the compensation fund range from between $20,000 to $1 million, though the total amount paid out will not be finalized until every single claim has been analyzed. Most of the submitted claims have insufficient evidence to qualify for a payout though.

According to lawyers representing the victims and their families, the compensation fund is not yet sufficient. For instance, the fund only covers a fraction of all the consumers affected by the ignition switch defects, which span over millions of cars and several models.

In addition, the compensation fund does not cover victims due to cars connected to another recall order released in June for over eight million cars, as GM is claiming that there is no conclusive evidence that the three fatalities related to the cars in the recall order can be linked to the faulty ignition switches issue.

GM, the biggest car maker in the United States, is facing class-action lawsuits connected to alleged lapses in safety procedures. Ongoing probes such as those by the Justice Department could lead to millions of dollars' worth of fines being placed upon the company.

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