TOWING EXPERTS - A BURNES COMPANY

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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 considerably 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.

Incident Management Towing documentation is far more comprehensive than Consent Towing. We must describe what we did, how we did it, equipment & manpower used, detailed vehicle information, 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, dealing with insurance companies, detailed information on who removes the vehicle from our yard, release affidavits and detailed information on disposal of the vehicle if it is unclaimed. It is routine to spend as much if not more time on the paper work than is spent conducting the actual work. 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 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. In addition to cash, it is mandatory for us to accept a credit card, debit card or electronic check, which cost us up to 6% of the total bill. Then we run the risk of having payment stopped on these instruments. The law requires us to accept them but the law does not require the customer to honor them.

Vehicle Storage Facilities must have a storage area with secured fencing, lighting, durable surface and required insurance for the consumer’s protection. The facilities are inspected by the State at least once every two years and may be inspected as often as the State deems necessary. Owners and employees of the storage facility must be randomly drug/alcohol tested at least once a year. 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 for which we cannot charge. We must escort owners, adjusters, law enforcement, lawyers and others in the yard to do their jobs at no charge. We receive as many as 10 phone calls or visits from the various individuals involved on each vehicle. We are required to release vehicles 24 hours a day within one hour of request. 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 $1850 each by the time they are disposed of. The processing of these vehicles will take 72 to 76 days and 95% of the unclaimed vehicles bring scrap iron prices of around $100 from the crusher (if they will even buy them). If we bring in a 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. Environmental issues are a major problem for the storage facilities and have created monetary costs of thousands of dollars. Unclaimed vehicles are a cost that must be calculated into every accident/impound tow we conduct.

Tow trucks and storage facilities are regulated the Texas Department of Licensing & Regulation. This does not mean that the laws are enforced and in many areas, little‘s done to make the illegal operators comply so we must compete with illegal operators who operate at bargain basement prices. A charge by an illegal tower will be considerably less due to no insurance premiums which run several thousands of dollars, no permit fees, less time to complete the job by them 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 illegal operators take business from the legal operators thereby increasing our overall costs and reducing our revenue. The licensed towing operations are subject to fines in the thousands of dollars for making an unintentional mistake. Towing operations doing Incident Management Towing must obtain an Incident Management Towing Permit from the State to operate a tow truck within the boundaries of any public roadways. Under this permit, 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 $50,000 of cargo insurance to cover the customers vehicles compared to $300,000 liability for Consent Towing and no cargo insurance. Each driver must obtain an Incident Management Towing Operator’s License and renew this license annually. Certification by a Texas Department of Licensing & Regulation approved course, which currently costs as much as $400 per driver. Prior to the first renewal of the Incident Management Towing Operator’s License, the license holder must complete an eight-hour professional development course relating to Incident Management Towing. All operators must complete a designated four-hour continuing education course before the operator’s license may be renewed. My 2010 costs are: 2010 Tow truck & cargo insurance $5308, Vehicle Storage Facility & office insurance $1471, five required government licenses $850 plus all the other normal business expenses. Being located in a rural area creates a much higher rate per tow than would be seen in the more urban areas.

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 much less 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 must be allocated to Incident Management Towing. There is no justification for passing any of these costs on to the routine Consent Towing sector. 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!

Should you have any questions or suggestions, contact us at any time.

Please contact:

P. O. BOX 881
KINGSLAND, TEXAS 78639
PHONE 325-388-6380
FAX 325-388-3874
E-MAIL ron@towingexperts.com