CHICAGO (CBS) — Insurance companies are fighting back against rogue tow companies they said are taking advantage of their customers, and a group is organizing to find a solution.
CBS Chicago has reported on these tow truck companies for years, and insurance companies have also been hearing about this issue for even longer.
“This goes back probably 10 years. I think it’s the inability to determine what would be the best way to put stronger regulations in.”
Kevin Martin is the Illinois Insurance Association’s Executive Director, representing companies like Allstate and State Farm.
He’s been working on trying to get the state and the city to take decisive action to fix the problem when tow companies register and legally get their licensing through the state but then take people’s cars in bad faith, manipulating a situation where the driver feels vulnerable because they’re in a car accident.
He said it’s become a priority now because…
“I think what’s happened, especially in the last two or three years, is there are legislators who have worked in the General Assembly that have had this happen to them,” Martin said.
The companies hold vehicles while charging exorbitant fees to get them back.
“That not only affects individuals who have insurance, but unfortunately, some people don’t carry tow coverage,” Martin said.
A few insurance companies testified to the ongoing issue at City Hall in May, working on new ideas and pulling from cities like Philadelphia, where they operate using what they call a “rotational tow system.”
“There has to be a towing list of people who are legitimate towing operators. If you’re not on that list, you can’t be called,” Martin said.
Alderman Gilbert Villegas plans to introduce a new city ordinance in the next few weeks to help curb rogue tow companies. The goal is to have those solutions passed by the end of this year.
