Veteran US compensation expert Ken Feinberg has been hired by Boeing to oversee the distribution.
The multiyear payout is independent of lawsuits filed by families of the 346 people killed in the two 737 MAX crashes, which happened in October 2018 and March of this year, a Boeing spokesman said.
Chief Executive Dennis Muilenburg, who has repeatedly rejected suggestions of a design flaw in the 737 MAX, acknowledged implementation shortcomings.
Muilenburg said Boeing followed the same design and certification process it has always used and denied that the MAX was rushed to market. He said he would not resign, and left a press conference as reporters peppered him with questions.
Boeing has been under scrutiny following a March 10 Ethiopian Airlines crash of a 737 MAX that killed 157 people, the second deadly crash involving in the aircraft in five months.
A preliminary report issued by the Ethiopian transport ministry cast further doubt on the system controlling the Boeing 737 MAX 8 model, which has been grounded worldwide since almost a month.
The Wall Street Journal reports that the pilots of the ill-fated Ethiopian Airlines flight followed all the emergency procedures laid out by Boeing but could not control the aircraft.
Boeing's MCAS anti-stall system, which was implicated in the October crash of a 737 MAX 8 airliner in Indonesia, was also activated shortly before a recent accident in Ethiopia, sources are reporting.
Family of Jackson Musoni, a citizen of Rwanda who died in the Ethiopian Airlines 737 MAX crash, file a lawsuit against Boeing Co in US federal court.
Boeing share prices have struggled as the company loses the trust of the regulators and airlines in light of recent air crashes involving its 737 MAX planes.
Airlines worldwide grounded the jet after the deadly crash of an Ethiopian Airlines flight this month. It came less than five months after 189 people died in the October crash of another Max 8 off the coast of Indonesia.
Boing said it was updating software to address how the aircraft's flight control system MCAS (Maneuvering Characteristics Augmentation System) responds to erroneous sensor inputs.
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