March 11, 2004 by Canadian Underwriter
Ontario’s brokers are “extremely pleased” with the decision to remove the cap on towing and storage costs that had been part of a package of reforms to the province’s auto insurance system.
Insurance Brokers Association of Ontario (IBAO) CEO Bob Carter met with Mike Colle, parliamentary assistant to the Minister of Finance and the man responsible for auto insurance reform, to discuss the towing cap, amongst other issues, on Wednesday of this week. Carter reported that the cap, which was to be set at $300 and come into effect mid-April, was scrapped and that “it was agreed that other methods would be developed to control the few unscrupulous towing and storage facilities that were overcharging insurers and the public”.
The cap was conceived as a means to deal with abuse of such costs under the current system, but many groups objected, noting that legitimate towing and storage claims often exceed the $300 mark.
It is not yet known what “other methods” may be employed to deal with tow truck and storage companies who are overcharging.