Vehicle accidents can be stressful, worrying about injuries, vehicle damage, and insurance can put you in a difficult situation. You should be wary that tow truck and storage scams can inflate insurance claims that raise everyone’s premiums. How it works is a “chaser” tow truck will rush to the scene of an accident and push you to tow you to a specific repair shop or storage facility. These shops pay high referral fees to the chasers for bringing them your business. However, to recover the fees, they may “pad” their bills and pass the costs directly to you. Insurance companies may choose not to do business with these shops, and if you later choose to move your vehicle to another shop you may still be required to pay for the original towing fees, storage, and possibly other administrative fees. Your insurance company may not cover these fees, and if left unpaid, the Repair and Storage Liens Act allows the repair shop to recover the costs by selling your vehicle!
When getting your vehicle towed after an accident, few drivers know that they have a right to decide where the vehicle is towed! In Ontario, tow truck operations are required to tell you if they are receiving financial incentives to tow a vehicle to a particular vehicle storage facilities or repair shop. If tow truck operators recommend a repair shop without being asked, they may be breaking municipal bylaws. It is always important to know your rights.
For more information, the Financial Services Commission of Ontario (FSCO) has provided a helpful tip sheet for drivers to identify these scams.
As an independent insurance brokerage, our broker’s work for you. To ensure that you receive proper insurance advice for your risk, contact a broker representative at (416) 494-1268.