Tow truck industry: Ontario drafts new rules

Consumer Services Minister Tracy MacCharles introduced legislation on Tuesday intended to further regulate the tow truck and vehicle storage industry in Ontario, a move the government says will help to lower insurance costs for drivers.

• Ontarians pay highest car insurance in Canada

If passed, the legislation would affect 1,200 tow truck operators and 3,000 tow truck drivers throughout the province.

According to a statement released by MacCharles, the primary changes to theindustry's regulation regime would require tow truck operators to:

• Have permission from a consumer or someone acting on behalf of the consumer before charging for towing and storage services.
• Publicly post prices and other information, such as the operator's name and contact information.
• Accept credit card payments from consumers.
• Provide an itemized invoice listing of the services provided and the total cost.

The new legislationalso proposes to put tow trucks under the commercial vehicle operator's registration system, an industry oversight measure from whichthey arecurrently exempt.

MacCharles saidshe's heard too many stories about tow truck drivers using "dubious tactics" such as demanding hundreds of dollars in cash at an accident scene before any service is provided.

She says other drivers find their vehicles are towed far away to a storage centre that then hits them with "unexpected large" bills before they can get their car back.

Provincial oversight of the towing industry was a key recommendation of the Auto Insurance Anti-Fraud Task Force, which released its final report in November 2012.

Ontario tow truck drivers have a collision rate of about 20 per cent, compared with one per cent for other commercial vehicles and three per cent for private passenger vehicles.

MacCharles say their collision rate is so high because they often race to accident scenes to try and get the business first.She says regulating the towing industry will help lower costs and reduce fraud, which will in turn allow insurance companies to lower premiums.