Experts Share Tips for Combating Predatory Towing
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PHOENIX — States are taking aim at towing companies that prevent carriers from accessing cargo in a trailer after a rig has been dropped off after a tow, a panel of insurance experts said.
“Having dealt with a few tow truck companies, they are pretty scary people,” said Dean Croke, principal analyst with DAT Freight and Analytics, during the Motor Carrier Insurance Education Foundation annual Western Conference on May 19. “This is an important issue in the trucking industry and we need to address it.”
Croke was joined by J.W. Taylor, managing partner at the law firm of Taylor Johnson, and Tony Bradley, president of the Arizona Trucking Association, in a discussion that covered the ongoing problem of towing companies refusing to release the cargo after they have towed a truck in for repairs, and towing costs that can sometimes creep well into five-figure territory. The panelists agreed there are ways the trucking industry can successfully combat these tactics.
Taylor stressed that the first step is to not be intimidated by a towing company when it presents a bill that seems unrealistic.
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“You can say I’m going to call the cops, and the response of the towing company is, ‘Go ahead, please do,’ ” he said. Instead, he said, a carrier’s first call should be to its insurance provider as they’ll generally have much more leverage.
“Find out if you have towing coverage, this is missed so many times,” he said.
He also urged finding out what is permitted under local laws. “This is a state-by-state question, and this is also, sometimes, [a] municipality issue,” Taylor said.
He cited Florida law as an example. “A lien on equipment in the state of Florida is not a lien on the cargo,” he said. “You can demand in Florida that you release all personal property that is not in the vehicle and that includes the items in the trailer, the cargo.”
Croke noted that several states have laws on the books that specifically prohibit towing companies from holding cargo, and other states are taking similar action. In Maryland, for example, Gov. Wes Moore on May 16 signed a bill that establishes a committee that will set specific rates for police-initiated towing of medium- and heavy-duty trucks.
Bradley said state trucking associations can also help.
“If you have examples of extreme towing bills, bring them forward,” he said. “If you show that you got charged $68,000 for an hour and half of work and they held [your] load, please bring these items forward. Show us the ridiculous bill [and] let us run with it from there.”
The issue has become a bigger one for trucking; the American Transportation Research Institute has made predatory towing a top five issue that it researches this year.
More broadly, panelists urged motor carriers to protect themselves from these and other types of risks by employing best practices in terms of safety and compliance.
“Managing risk is not just buying an insurance policy. There is a lot more you have to do these days to manage the underlying risks,” Croke said. “Managing risk is a very complex thing and the data points are there if you choose to look.”
For example, he noted that maintaining more predictable schedules for drivers can help improve safety. He cited electronic logging device data that indicates that drivers who start their work days across different start times during a week or have rotating shifts often are at a higher rate of risk than drivers who routinely start at the same time.
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“The ELD data shows the driver’s start time every day, and you can see it is the most predictive data around,” he said. “If it’s 2 a.m., then 6 a.m., then midnight over the course of a week, that will destroy a driver’s sleep time.”
Effective record-keeping also can help protect motor carriers, especially in an age of so-called “nuclear verdicts,” defined by ATRI as those that result in a judgment of more than $10 million. The panel took questions on this specific topic.
“It’s critical for companies to have a proper data and retention policy so an attorney cannot use the data to present you to the jury as a bad actor,” Taylor emphasized. “Don’t be afraid of the data — use the data to improve your company.”