Car Insurance Cos. Expected to Pick Up Tab for Crashes

car crashed into poleThe Quincy, Mass., City Council voted this week in favor of fining motorists who cause auto accidents that require the response of the city’s emergency services. Mayor Thomas Koch is expected to sign the ordinance, reports the Quincy Patriot Ledger, despite several peoples’ voicing their opposition to the plan.

The Property Casualty Insurers of Association of America (PCI) doesn’t believe that asking insurance companies to pay for emergency services is the answer and could lead to insurance hikes.

“It is just another way for local governments to garner revenue at the expense of the motoring public,” said PCI Vice President of state government affairs Frank O’Brien in a statement. “The fire department’s cost recovery program has many fundamental problems, but the underlying thinking behind this scheme is that there is a pool of ‘free money’ out there for the taking if we simply levy a charge on insurance companies. But there is no free lunch.”

While most consumers understand that an accident affect insurance, not much is known about how Massachusetts insurers will react to the new law. Service fees will range from $200 to $600 an hour depending on the services used and will be billed to the drivers’ auto insurance company. The Patriot Ledger says the vendor that services the fire department stands to earn 20 percent on insurance payments collected from the fees.

Quincy isn’t the only city to look into charging motorists for emergency services. The practice has been brought up in several West Coast cities as of late. Sacramento, Calif., is currently considering instituting such a fee, and Huntington Beach, Calif., recently approved a proposal to impose accident-response fees.

A number of states have begun banning the practice, the first being Missouri in 2007. According to the PCI, 10 states currently have municipal accident-response-fee bans in place.

About Ben Zitney
Benjamin Zitney has been covering the auto insurance industry for the past 2.5 years. Before coming to Online Auto Insurance News, he produced an extensive company history of the 30-year-old California Joint Powers Insurance Authority and worked at the Cal State Long Beach Daily Forty-Niner as a reporter, copy editor and news editor.

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