The National Insurance Crime Bureau (NICB) says it is receiving reports of price gouging by towing companies and impound lots in the aftermath of Hurricane Sandy.
Member companies are already receiving bills with classic signs of price exploitation. For a tow that occurred on October 30, one towing company charged $2,150, which included a $1,250 “recovery” fee in addition to charges for towing, storage and administration.
NICB members report towing firms are hooking up vehicles without the owner’s consent and telling the owners that all vehicles are being towed off the street, without any authorization from local authorities. Insurers also report that towing companies are going door to door soliciting business, telling people they will contact the insurance company and handle the expenses. One company even claimed that 50 percent of the charge will go to the American Red Cross.
“These charges are way out of line with reasonable fees and it’s akin to someone charging $20 to $30 for a gallon of gas just to take advantage of the situation,” said NICB President and CEO Joe Wehrle. “This kind of outrageous conduct is only adding to the misery and expense incurred by people who have already suffered far too much.”
Wehrle noted that vehicle owners who do not have towing or storage coverage under their insurance policy may be at risk of having their cars crushed for scrap and still being on the hook for exorbitant fees long after their cars are gone.
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