The Ombudsman for Short-Term Insurance offers guidelines to policyholders to avoid exorbitant towing, recovery and storage fees

Brian Martin, The Ombudsman for Short-Term Insurance

The Ombudsman for Short-Term Insurance says that disputes between short term insurance companies and their clients arise on a daily basis regarding towing and storage fees and the cover provided for this. Many of these disputes are due to policy holders not knowing what they are covered for by their insurer as well as the correct procedure to be followed at the scene of an accident and later during the claims process.

To avoid falling victim to exorbitant towing, recovery and storage fees, policy holders should ensure that they know what their rights are and the correct procedure to be followed at the scene of an accident and afterwards.

Ombudsman’s Guidelines:

* Study your short term insurance policy to ensure that you know exactly what you are covered for with regard to towing and storage fees as well as what is required from you at the scene of the accident. Contact your broker or insurer if you are unsure of anything.

* Always keep the emergency assistance telephone number in the vehicle, or record it on your cell phone.

* Phone the emergency assistance personally to obtain authorisation for the towing of the vehicle if this is required by the policy. Do not rely on confirmation obtained by the towing service that they are a preferred service provider of your insurance company and do not allow anyone to phone on your behalf.

* In circumstances where it is not required that the towing must be authorised by your insurer, you may contract upfront and directly with the towing service to ensure that a reasonable fee will be charged.Obtain proof in writing of the amount that will be charged and the place where the vehicle will be towed to, before you authorise the towing of the vehicle.

* Submit your claim and inform your insurer of the arrangement between the towing service and yourself as soon as possible to avoid unnecessary storage costs which will be calculated on a daily basis.

* If there is more than one driver who drives the insured vehicle, ensure that they are aware of the procedures that should be followed.

If you did not have the opportunity to contract with the towing service at the scene of the accident, the towing service will only be entitled to recover the reasonable cost for the towing, possible recovery and storage of the vehicle. If the release fee is more than what you are covered for, your insurer should first obtain your consent before payment is made to secure the release of the vehicle.