WHY DOES INCIDENT MANAGEMENT TOWING COST MORE THAN CONSENT TOWING?
To the public, all towing appears to be the same. It is not. There is accident/impound towing known as Incident Management and there is the routine towing known as Consent Towing. There are many costs associated with Incident Management Towing that Consent Towing does not incur. Incident Management Towing must provide immediate response with all the equipment as well as the work force required to carry out the required duties. Incident Management Towing is 24 hours a day, 7 days a week, regardless of what we might be doing at the time and without advance notice. Consent Towing does not require the “urgency” or the “equipment” with costs that are far less than Incident Management Towing.
Equipment requirements are vastly different. Consent Towing requires a truck with a flat bed or wheel lift. Incident Management Towing requires the truck to have recovery booms, winches, blocking, recovery straps, chains, dollies, snatch blocks, spreader bars and other specialized equipment for completing any project we are required to do. On your particular job, some of this equipment will not be required, but we must have it in the event it is needed. On occasion, tow trucks are subjected to necessary abuse from working in remote locations off the main roadway to carry out the jobs resulting in increased wear and damage to the equipment. Incident Management equipment costs are considerably more than Consent Towing costs.
Incident Management Towing is far more dangerous due to the circumstances under which we must perform. Darkness, fog, cold, ice, extreme heat, rain, traffic, body fluids, jagged metal, battery acid, broken glass, spilled fuels, mud, cactus, fire ants, snakes, fences, swift water, hazardous materials, diseases and other precarious situations create a very careful and deliberate work situation for the protection of everyone and everything involved. Towing personnel are more likely to be injured or even killed while conducting the necessary duties of Incident Management Towing. The stress of this danger and the slower pace we must work reduces productivity increasing the time it takes to complete the job, which increase the costs resulting in much higher rates charged for the services.
Tow trucks and storage facilities are regulated. This does not mean that the laws are enforced and in many areas, little’s done to make the illegal operators comply. A charge by an illegal tower will be considerably less due to no insurance premiums which run several thousands of dollars, less time to complete the job by not hooking up safety chains, tow lights, wheel straps, four point tie downs, using a pickup and trailer instead of a safe tow truck, etc., etc. These operators take business from the legal operators thereby increasing overall costs and reducing our revenues. To get on Police Rotations the owner/operators must have a criminal background check and drug/alcohol testing. Each truck must have a minimum of $500,000 of liability plus $75,000 of cargo insurance to cover the customers vehicles compared to $100,000 liability for Consent Towing and NO cargo insurance. My tow truck insurance averages $5000 per year for one truck. The Vehicle Storage Facility & office insurance is around $2500 per year. Additional employees require addition licenses and related costs. This is on top of all the other normal daily business expenses. Being located in a rural area creates a much higher cost per tow than would be seen in the more urban areas due to the much lower volume of available business.
Unlike urban areas, rural area Incident Management Towing companies, by sheer necessity due to the much lower volume of business of both the towing and storage sectors, must also have a Vehicle Storage Facility to survive. These facilities must have a storage area with secured fencing, lighting, durable surface, insurance for the consumer’s protection, extensive signage, etc. The facilities are inspected by the State at least once every year and may be inspected as often as the State deems necessary. Owners and employees may be routinely and randomly drug/alcohol tested.
Contents of the vehicles are required to be inventoried and secured. Vehicles with broken windows must be tarped, untarped and retarped several times before the vehicle leaves our yard. We must escort owners, adjusters, law enforcement, lawyers and others in the yard to do their jobs. We receive as many as 10 phone calls or visits from the various individuals involved on each vehicle. We must obtain hard copies of motor vehicle records on every vehicle. These services take many hours of time and considerable dollar cost of the required supplies.
We are required to impound vehicles, which the owners no longer want and just leave on the side of the road. We will not collect a dime on 35% of the vehicles we impounded because the owners or insurance companies simply decided to dump the vehicle on us instead of paying the bill, which they are legally obligated to pay but there is no recourse to make them pay other than filing a civil suit. We will then incur additional expenses in processing and disposing of these vehicles. The charges will reach an averaging $1400 each by the time they are disposed of. The processing of these vehicles will take at least 60 days and 95% of the unclaimed vehicles bring scrap iron prices from the crusher. The motor oil, transmission oil, differential oil, Freon, antifreeze, wiper fluid, brake fluid, tires, batteries, fuel and fuel tanks must be removed before they can be crushed and we must have a minimum of 50 vehicles. Environmental issues are a major problem for the storage facilities and have created monetary costs of many thousands of dollars. Rarely will we recover the towing charge much less the total costs. Unclaimed vehicles are a cost that must be calculated into every accident/impound tow we conduct.
Paperwork and recorded keeping is extremely intensive. We routinely spend several more hours on the paper work than is spent conducting the actual work at the scene of the incident. We must document detailed owner/lien-holder information, certified notices to the registered owner/lien-holder, notifications to law enforcement, info on when and where the vehicle is transported, deal with insurance companies, detailed information on who removes the vehicle from our yard, release affidavits, detailed information on disposal of the vehicle if it is unclaimed and much more. Federal law also requires us to file reports with the NMVTIS agency when our processing is completed, another when the vehicle is disposed of and to whom it was transferred. We must maintain complete records on these jobs for at least two years and in many situations, are required to go back in our records researching certain vehicles for the Feds, State, insurance companies, lawyers and vehicle owners. We may be subpoenaed to appear in court as a witness for the prosecutor, defense, civil plaintiffs or civil defendants at our own time and expense.
Consent Towing does not need a storage facility, office or a truck capable of recoveries. They are not required to fill out any documentation on the vehicles they tow. The liability insurance requirements are approximately one-half the requirements of Incident Management insurance. They are not required to carry cargo insurance to protect your vehicle. They are not required to obtain any certifications or formal training. They are not required to be available 24 hours per day without notice. Equipment costs and operator wages are less. They are not required to have the level of expertise necessary for Incident Management Towing. Risk exposure is much less. The costs and requirements associated with Consent Towing are very much lower than the costs of Incident Management Towing. Never ending government regulations, high insurance rates, record fuel prices, extensive operational requirements and all the extra costs incurred with Incident Management towing must be allocated to Incident Management Towing. There is no justification for passing any of these costs on to the routine Consent Towing sector, but should those costs be passed to the Consent Towing, those rates would probably increase by 200 to 300%. Incident Management towing rates, by their very nature, must be substantially higher than Consent Towing rates to maintain the professional level and equipment that Incident Management Towing requires. Contrary to popular belief, the towing business is an extremely low profit business with extremely high investment costs. Do you know anyone in the towing business that is RICH? If you do, it is an absolute certainty that they made their money from something other than towing!