PCI: Aggressive Towing Practices Drive Up Insurance Costs

Chicago, Philadelphia and New York are the three worst cities nationwide for unscrupulous auto towing and storage fees, according to a new survey released by the Property Casualty Insurers Association of America (PCI).

Worst states for towingTow truck operators in those cities were the most likely to inflate their fees and make it “nightmarish” for motorists to retrieve their vehicles, the poll found.

Aggressive operators make a bad situation worse for motorists who have been involved in an accident, said Bob Passmore, senior director of personal lines at PCI.

“It is a no-win situation,” Passmore said in a news release. “These bills drive up out-of-pocket expenses for consumers and affect auto insurance costs that they pay.”

The association, which has more than 1,000 member insurance companies nationwide, based the survey on negative feedback insurers are hearing from consumers. Those gripes included spurious “helper fees” and “wait-time fees,” padded bills and the feeling that “the vehicle was being held hostage.”

The worst five cities nationwide, according to the survey:

1. Chicago

2. Philadelphia

3. New York

4. Atlanta, Ga.

5. Houston

The National Insurance Crime Bureau (NICB) reports that, between 2009 and 2010, there was a 116 percent increase in the annual number of claims flagged as having inflated towing and storage fees.

Authorities across the nation have cracked down in recent years on what they say are predatory towing companies.

In Illinois, which the survey ranked the worst state nationwide for towing hassles, the state attorney general’s office sued three Chicago-area tow companies in 2007. Two years later, Cook County state’s attorney filed a consumer fraud lawsuit against four companies.

Industry experts point out that there are many honest tow operators, but say the deceptive practices of others not only force consumers to pay more out of pocket, but also make it difficult for them to find cheap auto insurance.

Consumers have a responsibility to know what their policy will cover, according to the NICB, a nonprofit industry group.

The PCI points out that there are steps that consumers may take to protect themselves in the aftermath of an accident:

–Be prepared. Many insurers, auto clubs and even credit card companies offer roadside assistance programs that include towing services.

–Know that you have the right to call your own tow truck and decide where to have your vehicle taken, whether to a repair shop or to your driveway.

–Get an itemized statement of charges and ask for clear information on how to retrieve your car.

–Check daily storage prices and other charges and be careful what you sign.

–Watch out for “Good Samaritans.” Some tow truck operators pose as passersby who are just trying to be helpful.

 

About Gregor McGavin
Gregor McGavin is an award-winning journalist who has reported across the country for such publications as The Associated Press, the Arizona Republic, the Pittsburgh Tribune-Review and the Press-Enterprise.

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