Before your car breaks down, needs a tire change, or gets into a severe crash on a residential road, be aware of the most common tow truck scams used by amateur service providers. Learn how to avoid a frustrating, expensive, and potentially dangerous situation here.
After a serious accident renders your vehicle immobile, you might have to hire a towing company to move your car from the side of the road and store it in a lot until your insurance company can examine the damage. While this seems simple enough, you should also be vigilant to avoid being scammed by a bandit tow truck service. Towing and storage fees can be expensive enough with an honest company, but it can cost a fortune when your car is being held hostage by a fraudulent business.
The Property Casualty Insurers Association of America (PCI) reports that the average cost of a tow and storage for a wrecked vehicle has skyrocketed thanks to bogus towing and storage companies and their “creative” (read: abusive) billing practices. These cost both consumers and auto insurance companies hundreds of millions of dollars per year. Of note: according to the PCI’s latest study, Houston and Dallas are the cities most in need of pro-consumer towing reform.
While the majority of towing and storage companies run honest businesses, the insurance industry advises car owners to be cautious of those they haven’t done business with to avoid being scammed.
How do these fraudulent towing and storage companies stay in business?
Local and state governments are federally blocked from setting a standard fee for consensual towing and storage.
Consensual tows refer to when towing services take vehicles from the scene of an accident.
Non-consensual tows are regulated on the state or municipal level and refer to when towing services take vehicles after their drivers park illegally or commit other offenses.
Without statewide regulations, fraudulent tow truck companies have a lot of wiggle room to increase towing costs. Sure, in theory, they might be able to help jump-start a dead battery, fix a flat tire, assist with a lockout, or perform other tow services. But that doesn’t mean they won’t follow their own rules when it comes to setting post-accident towing expenses, including the costs of base fees (also known as hook-up fees), recovery services, or long distance towing.
And you’d be wrong to think the at-fault party’s insurance will cover this expense for you. While the insurance provider will cover the cost of repairs for your car, it can refuse to pay the storage cost. The company might argue that you should’ve gotten the car out of storage within a reasonable amount of time. However, getting your vehicle out of a fraudulent storage facility can be impossible.
How long can an impound lot hold onto your car?
On average, it can take anywhere from ten to fourteen business days to receive a police report detailing a car accident.
This process can take even longer depending on how quickly the at-fault driver’s insurance company cooperates and you’re reimbursed. The report, and therefore the payment, can take even longer if the parties disagree over who’s truly at fault. All the while, your towed vehicle may still be sitting in a storage lot, charging up a tab.
The best towing service providers will work with your insurance company to expedite the entire process. That’s why it’s advised you secure an auto insurance policy with a company that has officially partnered with approved and certified local towing companies.
How to avoid costly tow truck and storage fees
- Form a plan of action in advance and call your insurance company. In most cities, the police will call a tow company to the scene of the accident if you can’t drive your vehicle. But can you trust the tow company that your local or state police have on call? Your first instinct should be to contact your insurance company right after an accident and have a representative recommend or call a towing company for you. Consult your auto insurance policy or speak directly with your insurance provider to form a plan around what to do if you’ve been stranded or totaled. Know what your company can and can’t do for you. Did you opt into an emergency roadside assistance endorsement with your insurance company? Do you have your agent’s phone number on speed dial? Share your plan with all of the drivers on your insurance policy, and remember: you have the right to decide where your vehicle will be stored.
- Ask for an adjuster. When you’re on the phone with your insurance agent or representative, be sure to ask that a claim adjuster looks at your vehicle as soon as possible. The adjuster will take a look at your car in storage and then be able to move to a repair shop. The more quickly an adjuster reviews the damage, the sooner your vehicle can leave the storage lot, and you won’t be slammed with a hefty bill.
- Collect all the information. When the tow truck that your insurer or the police called has arrived, make sure to collect the necessary paperwork for your records. You should ask for a printed and itemized invoice that includes the fees for towing, storage (if applicable), and any other miscellaneous charges. Double-check that the signage on the tow truck matches what’s on the paperwork. You should also get some documentation to confirm where your vehicle will be stored once towed (if applicable). If you’re unfairly charged, having a record of abusive billing practices will help your case if you choose to contest your fees.
- Avoid unsolicited service. When you get into an accident, never accept services from a tow truck that happens to appear at a convenient time. It may seem like a miracle, but if you or the police didn’t call it to the scene, they’re most likely a scam. This is especially true if the tow truck has no signage or the tow truck driver asks for information about the vehicle’s lienholder, your insurance, or other personal information.
- Stand your ground. If a flatbed arrives out of nowhere and refuses to leave, feel free to call the police to report fraud. It’s better to be safe than sorry. “Traffic chasers” are known to sniff out accidents or stranded vehicles in the hopes that they can gouge desperate motorists.
- Become a member of a roadside assistance club. If you aren’t already a member of a roadside assistance club like AAA, consider joining one to take all the work out of getting your own tow truck. You’ll have easy access to professional roadside assistance services you can trust. It’s an especially smart move to join your regional chapter of AAA before a big road trip in an unfamiliar area. Membership can cost as little as around $50 per year, and often includes 100+ miles of free towing for up to four emergencies.
- Add collision coverage to your policy. Adding collision coverage to your insurance policy will cover the costs of your repairs, towing, and storage, regardless of who was found at fault in the accident. You should consider getting a higher amount of collision coverage if you drive an expensive or new vehicle that would be expensive to repair or replace. If you don’t have collision coverage, you should try to get your car out of storage as soon as possible while you’re working with your insurance company and the other driver’s company. This process can take a while and could lead to charges over an indefinite period.
Your insurance company is your best line of defense against bandit towing companies, so make sure you have a provider you can trust and afford.
Insurify allows you to customize, build, and purchase a policy online in minutes so you can be prepared for whatever you encounter on the road. You can even choose a company that offers free or small-change roadside service or towing coverage.
Happy saving. With the right car insurance policy, you’ll be back on the road in no time!