Tow Truck Operators Shift Blame in Price Gouging Debate
WASHINGTON — Tow truck operators, responding to accusations of widespread price gouging by their industry, argue that insurance companies share the responsibility for rising costs.
The Federal Trade Commission (FTC) addressed allegations of overpricing by towing firms against motor carriers in a proposed rulemaking last year, advocating for greater billing transparency among tow truck operators.
In line with the FTC’s initiative, the Federal Motor Carrier Safety Administration (FMCSA) sought additional public input on potential oversight measures related to this issue.
However, representatives from towing companies conveyed to the FMCSA that underinsurance among carriers is a far more significant concern than the exorbitant rates that towing operators allegedly charge for recovering trucks from accidents. James Austin, a spokesperson for the Michigan Towing Association, stated, “Many truckers are misled into purchasing insurance with inadequate coverage, only to discover that their policies fall short in the event of an accident.”
Austin also highlighted that the FTC’s proposal fails to address the risks posed by uninsured and underinsured truckers operating without proper registration and certification. “These irresponsible operators endanger public safety and add extra burdens on towing companies, who often face delays in receiving payment for their services,” he noted.
As reported by a towing company, nonpayment for fees has surged to 40% in heavy-truck accident recoveries. “We’ve witnessed insurance industry representatives boast about tactics to deny payments to towers, which is distressing for those of us obligated to pay our employees and maintain expensive equipment,” the statement claimed.
Josh Tillett, representing Blatt and Tillett Truck and Trailer Repair in Jonestown, Pennsylvania, echoed Austin’s perspective, asserting that truckers frequently opt for inadequate coverage. He urged against overregulating towing services, stating, “The FMCSA should not impose charges or operational guidelines on an industry already governed by existing consumer protection laws, as this would be both unnecessary and intrusive.”
Industry Perspectives and Regulatory Crux
The American Trucking Associations argue that a “patchwork” of state regulations creates a breeding ground for predatory towing practices targeting truck drivers. The Owner-Operator Independent Drivers Association has compiled a list of hefty towing charges faced by its members, including a staggering $100,386 fee for towing, which included a 5% administrative charge.
OOIDA emphasized, “Our goal, which should unite all stakeholders, is to either develop or modify regulations that deter bad practices without hindering legitimate operators.”
The American Property Casualty Insurers Association (APCIA), representing commercial trucking insurers, challenged the claims put forth by towing companies. They contend that insufficient local, state, and federal regulations allow predatory towing firms to overcharge truckers. “Historically, towing companies have fought against regulations, citing federal preemption,” they noted in their comments to the FMCSA.
APCIA advocates for the FMCSA to implement well-tailored regulations for the towing industry to safeguard both commercial and personal drivers from the few malicious actors. They assert that whether regulations come from the FTC, FMCSA, or both, “the public must be protected from abusive practices during these stressful situations.”
