With the goal of safeguarding vulnerable motorists, the Chicago City Council on May 26 voted to approve changes to the city’s ordinance requiring additional licensing for towing companies, according to the National Insurance Crime Bureau (NICB).
The Windy City has been plagued with towing abuse for some time, ranking as the second most affected major city in the nation with the problem. In addition, a survey of several insurance companies identified Chicago as one of the “most problematic” cities nationally for towing-related scams.
Chicago’s new regulations are designed to strengthen licensing provisions while also enforcing stricter penalties on offenders. The goal is to end unscrupulous towing service practices that prey upon innocent drivers, costing them far too much money and anxiety.
Several other cities and states have also acted to tackle towing abuse, which is widespread nationwide.
For example, Philadelphia instituted strict towing regulations, which have proven to safeguard customers and reduce the potential for insurance fraud. California passed regulations prohibiting tow companies from stopping at an accident scene unless called by the vehicle owner or law enforcement. The state also requires all tow companies to provide written estimates of all charges to the vehicle operator before proceeding with a tow. Arizona has similar laws on the books. And Ohio allows civil action by insurers against a towing company operator to recover a vehicle.
Millions of Americans have their vehicles towed each year, and too many are the victims of scams and abuse according to NICB. Nearly 50,000 towing businesses operate in the U.S., generating more than $8 billion in revenue, according to market research firm IBISWorld.