Hello, and welcome to today's webinar, Towing and Storage, Managing Towing and Storage Fees on Motor Truck Cargo Claims. Please be aware of the IMUA statement. I'm happy to provide a brief introduction for today's esteemed presenters. Sam Tucker is CEO of Carrier Risk Solutions, a startup in Atlanta, Georgia, that he began in 2015 that fuses technology with the Department of Transportation Compliance and Safety Fleet Management. Sam began his career in 2003 at Safeco as a Personal Lines Underwriter. He also underwrote at National Interstate, Berkshire Hathaway, and most recently Travelers. Sam holds 10 designations, including the Chartered Property and Casualty Underwriter designation. He is a valued member of IMUA's Transportation Committee. A self-proclaimed insurance geek, Sam enjoys spending his free time with his wonderful family. Sharon DeRiso is the Senior Marine Tech for CHUBB. She has been with CHUBB for 19 years working in the marine world, handling all lines of first-party marine business and overseeing the team technically. Prior to joining CHUBB, Sharon was with Cigna for 12 years in their marine department, again handling all lines of first-party marine lines of business. Sharon is a long-time member of IMUA's Transportation Committee and has been instrumental in adding value to much of the education program. Deborah Thompson joined Markell in 2010 as a Marine Claims Specialist. Prior to joining Markell, Deborah was with Allianz Global Corporate and Specialty from 2008 to 2010 as a Senior Claim Adjuster. Deborah began her career at William H. McGee where she spent 22 years as a Claims Adjuster. She is a member of the national group Women in Claims and is also a member of IMUA's Transportation Committee. Our final speaker is Bob Watson. Bob is President of Recovery Resolution Specialists. He is an expert in the field of heavy towing with over 40 years of experience. He's handled over 1,000 accidents as a tower himself and over 20,000 cases as President of RRS. This includes over 100 appearances in courts across the country as an expert witness. He's proud to share that Recovery Resolution Specialists has averaged a 28% savings on all the tow bills they review and recommend for negotiation. Prior to his towing career, Bob served with the United States Air Force. Again, welcome to all our presenters. We'll kick the presentation off with Sam Tucker. Sam? Sam, can you hear the, can you unmute your line? I got out of there. Okay, great. All right, sorry about that. Thank you. Good afternoon, everybody, and thanks so much for attending today. Thanks for the kind introduction, Lynn. I appreciate it. We're here to talk about towing and storage coverages and specifically towing and storage fees on claims and how that matters and what it impacts us as underwriters as well. So to start off with, really try to understand what's the problem? You know, what are we really dealing with when we're talking about towing and storage fees on these claims? I want to explore how coverage is handled today, trying to get a better understanding of exactly from a policy standpoint, a coverage standpoint, and an underwriting intent standpoint, what are we really trying to accomplish between balancing, providing our policyholders with value as well as actually mitigating the losses and damages from these towing and storage fees? And then with, can we really underwrite towing and storage? And that's a question we'll seek the answer here, and we'll chat about it in a little while. So what's the problem? Why does this matter? Why do towing and storage fees really matter? Well, mostly the problem simply is that we should be concerned with towing and storage fees because, one, they're mounting. They've started to become an increasingly larger part of all cargo losses. And a lot of that has to do with a number of different reasons, some of which Bob and others are going to get into a little bit. But mostly because the storage fees associated with the cargo, once it's in an accident or involved with a loss, simply comes out to be, you know, an increasingly good opportunity for folks in the towing and storage industry to come in and actually increase their revenue by putting it on to the cost of insurance carriers, insurance losses and claims that we're paying for. So it really matters, and that's the reason why we're here. In particular, this is because, again, looking at everything we're doing out there, taking a look at it, it's increasing. And so as it becomes more and more significant parts of the insurance claims that we're paying out on cargo losses, we need to start paying attention to it and understanding, one, that there is a problem, and then, two, trying to figure out ways to mitigate those issues as they arise and figure out ways to combat that to try to control losses and the costs associated with it. Also, there's an increased amount of auto-physical damage in illuring books these days. A lot of folks have started writing on the scheduled property floaters for auto-physical damage coverage and doing some other manuscripting. So it comes into play a little bit on those types of issues as well. But mostly, again, I'm going to focus it on cargo damage here, but it also bears mention, it also applies to auto-physical damage as well, too. So if you write those lines in your book of business on a property floater or any other way, you should definitely pay attention to it as well. Also, we're kind of our own worst enemy in a lot of ways. Everybody, every company handles it differently in terms of towing and storage fees and coverage for those. As we'll see later, there's a lot of abusive towing practices in the industry. And again, like I mentioned previously, a lot of what's going on, too, is the towing and storage companies are taking every advantage they can in many situations to jack up the price of the towing and storage bills because they know that there'll be coverage for it under their insurance policies. And as I said a minute ago, we're really our own worst enemy in many ways on the underwriting side up front because many policies have unclear policy language and the underwriter's intent's not really clear as to what we intend not covering as well as what we can actually go in there and physically expect on a loss settlement policy or loss settlement basis. Well, let's talk about how coverage currently applies and what we're doing on the front end to go ahead and take care of that to solve problems before they arise on the claim side. So, it's really one of three different ways. Coverage can be specifically stated. The policy form can be silent or not specified. Or in many situations, you can have a hybrid, the bereavement, or a non-bereavement policy. Or in many situations, you can have a hybrid, debris removal, slash preservation of property approach to the policy coverage form. Some general things to think about when you're starting to talk about coverages and how tolling and storage impacts them. In many policies, especially ISO and AIS forms, vehicle is not a covered property in most policy coverage forms. Additionally, property that you own is not covered in most policy coverage forms. And so, vehicles that are covered under auto physical damage rather than motor cargo forms. So, just kind of set the stage and look at it initially. The physical vehicles themselves are separate totally from the cargo policy. They should be on auto physical damage forms or on some other type of property floater. An example of a specifically stated limit, and this is borrowed from the auto physical damage policy, from Lloyd's and London in this instance. And it just specifically states, as you can imagine, in an event more than one covered loss, same loss, endorsement applies separately for each unit. Underwriters pay for tolling and storage on the map below. And they say, here's the limit, $10,000. So, they come right out and say, we're going to pay $10,000 for tolling and storage fees associated with each loss. And that's an example from physical damage policies. They're going to show you, too, that one, it belongs on a physical damage policy. And then secondly, it just gives you an understanding and ability to look at what a manuscript endorsement could possibly look like for your own policies on the cargo side. You can just come around and say it. Then you can say, it's really unspecified. So, we're not going to specifically commit to a particular cover amount. You can say, it's your expense in this instance. Expense for removed debris or covered property caused by resulting from a covered cost loss. And since most will pay for any one occurrence, then the coverage extension is $25,000 for debris removal. And we say, we're not going to cost, or we're not going to include extracting pollutants from land or water, and removing, restoring, or replacing pollutants in water. So, it takes all the pollution issues out immediately. But with this, this is kind of the debris, you know, as I said before, it's specified where you come around, stating a limit, say, we're going to give you $10,000 for tolling and storage fees associated with each loss. Or whatever amount you deem your policy. You can get it to the totally opposite end of the spectrum and say, we're just not going to say it all, and go for more, kind of like usual customary and reasonable type charges. And that's kind of what has got us into trouble in the past. And then, kind of the hybrid that we're talking about now, the debris removal coverage, and the preservation of property model, is kind of where we are in most situations now. So, going back for a second to look at a slide, it's unspecified. You know, for debris removal, we'll say, and for debris removal, this typically applies at the scene of the accident or loss, we're going to give you $25,000 if it's a cover cause of loss, and it occurs during the policy period. For instance, in a specific policy language. And then, this is kind of the hybrid approach. It's not unspecified anymore, and the situation is going to say, we're going to give you $2,500 for a coverage extension for debris removal. So, you'll have $2,500 specifically for it. And it's actually at the scene. And then, though you see the difference in this particular policy language at the bottom, it says, any charges for towing and storage are specifically removed from it. So, you're getting debris removal coverage. So, this policy excerpt gives you a little bit of language that says, debris removal coverage and this policy excerpt gives you a little bit of language that says, we're going to give you at the scene of the accident or loss, we're going to give you $2,500 for coverage to help take care of the debris removal. However, any charge for towing and storage is not going to be covered. So, that's kind of what I mean by hybrid. So, you're getting a little bit of coverage for debris removal, but you're not getting it for the actual towing and storage charges. While this isn't necessarily prevalent in the industry, it's due to a lot of the things you're this is becoming more normal. So, obviously, you know, with cargo, especially motor truck cargo liability, we run into all kinds of different issues in terms of where coverage applies, where it doesn't apply, when it applies, and when it doesn't apply. So, in this situation, you know, you obviously think about the three major exclusions at any cargo policy, mostly being due course of transit, written bill of lading, and care custody control of the property. So, in this specific instance, just looking at the cover property, this policy language, you know, other than describing declarations, et cetera, for transportation, it's kind of clear. And it says, we'll only cover property when loaded or unloaded at a facility, terminal, warehouse, or storage unit, storage area, up to 72 hours, excluding Sundays and holidays. So, you're looking at it and you say, okay, at that point, after the 72 hours, who has coverage for the cargo? Where does that lie? Well, usually what we do, too, is those are typically taken into consideration with preservation property coverage. We'll say, you know, preservation expenses is necessary to move it from one place to another to prevent further damage. You know, we're going to give you an additional 30 days of coverage after the property is first moved. And in some situations, actually, I'd say probably many situations, you'll also see the language on the bottom of this policy text here as well. It says, you know, in no event are we going to pay any more for towing, storage, and labor than $10,000 or the value of the undamaged property, whichever is less. We always like to make it a little more difficult. So combined, again, I'll go back one slide just to make sure everybody sees it. So you have things like due course of transit. You also have things like care cuts and control of the property. And written bill of lading has been a major exclusion in the policy, with the property having to be on a written bill of lading, obviously. So you're looking at the preservation of property, and we're coming through and looking at it and say, okay, the preservation of property combined with the debris removal coverage gives some coverage of the scene of the accident or loss, and then the preservation of property coverage comes on top of that and provides them 30 days extra. And in this situation, what I described in this slide gives them $10,000. So it actually comes with a specified limit. So the question then becomes, can you really underwrite towing and storage? My answer to that is no. I don't think you can really technically underwrite towing and storage. But can you up front, at least, when you're underwriting the policy and you're setting policy terms and conditions, determine what your intent will be in terms of how towing and storage will be covered, it's important to understand the situation that we're looking at today and the backgrounds of different organizations and different situations that arise from the losses that we've seen throughout the years, and try to take that into consideration in how that will impact your underwriting and pricing of an account. So again, can you underwrite it? I say, no, probably not. You just have to prioritize price work, and more so than anything else, really just sit there and understand that you can't neglect the towing and storage as potential areas for increasing the cost of the losses. So can you underwrite it? No, but can you actually try to mitigate damages or come across the top of it and try to make the claims folks' lives easier? Absolutely. And with that, we're going to turn it over to Sharon. Actually, you're going to turn it over to Debbie, but thanks, Sam. Sorry. It's all right. Happy to be here today to talk about towing and storage, including the claim challenges. And the challenges Sharon and I come across on a daily basis. Storage can be exorbitant. The record companies have charged $200 per day, if not more, to store property after a loss. They have, at times, completely exaggerated the number of hours it took to perform a service, and they have charged very high labor rates to recover and store the damaged property. An independent adjuster or claim examiner can try to reason and negotiate with a record company, but the record usually stands with the charge and are unwilling, excuse my teeth, unwilling to compromise. Unfortunately, this leaves the claim examiner to either arrive at a creative solution to lower the tow and storage charge or pay the invoice, making the handling of tow and storage situations very problematic. I've touched base on only the surface of issues that can arise, and we'll discuss more a little later. Over to you, Sharon. Thank you, Deb. Good day, everyone. As we know in the industry, motor truck cargo claims are often the most difficult types of claims to bring to a prompt and satisfactory resolution for many reasons, and one being, of course, the topic of this seminar, that is the high costs we encounter for wrecker and towing charges on a daily basis. However, I find that they can be often interesting, and no matter how many years you have handled them, you are always learning something new and informative. But don't get me wrong. We oftentimes get frustrated along the way as we tend to hit brick walls at times, but they can be interesting nonetheless. I think it's safe to say the towing industry has gotten a bit more problematic for us without a doubt, especially with the rates as of late. There are six states where we see the highest bills. They are Illinois, Oklahoma, New Jersey, New York, Connecticut, and Ohio. The charges incurred do become a monumental task for us with times leaving our poor insured with a large uninsured exposure. Like anything else, we try to negotiate these bills as best we can, as Deb mentioned, and then to add insult to injury in order to get the load out of storage, too, so that it can be on delivery to the cargo owners for further assessment, we must overnight the checks for expediency's sake. This can be very time consuming for us, but it's something that really needs to be done. And to make matters worse, the wreckers, the towing companies, they really do try to capitalize on the situation, and they bring many pieces of equipment to the scene regardless of the accident type, even if that equipment isn't needed. And this naturally just hikes up the overall cost. For instance, they charge for wait time, fuel surcharge, drive time, hours on the scene, among other items. There are, of course, agreed rates with some jurisdictions, and wreckers will bill at those rates working with local and state authorities. Some are just incredibly high. So we are not only faced with exorbitant recovery charges, but then with high storage costs. There are times we are hit with storage of goods in a relief trailer that's owned or rented by the tow company. And we have seen average rates of $200 per day for storage, which is just ridiculous, as Deb mentioned on a prior slide. In some cases, the product will then be put into the tow company's storage building or warehouse, where they even charge extra for this indoor storage. So as one can see, these costs mount quickly, which seems to be their ultimate goal. In some areas, the tow companies are now billing based on weight as a base charge, and then they tack on additional charges for equipment and labor. So, for example, on an 80,000-pound gross vehicle weight loss, there's a base rate of 20 cents a pound. So right off the bat, before we even get started, we're talking $16,000. Unfortunately, tow and recovery bills in excess of 30,000 are getting to be the norm these days, even in a soft layover incident. Another major obstacle that we face and that we see regularly is that we have successfully negotiated the rates and the fees that are associated with the cargo the majority of the time, but then the release of the cargo is unfortunately at the mercy of the resolution of the fees that are owed by the physical damage portion of the loss, which is the tractor trailer. Believe me, it presents more of a problem when the limits for towing and recovery that attach to the trucker's physical damage coverage are low. This makes it harder for negotiation among the parties involved, including us as insurers. Then on top of that, we see slow payment by some policies where we see tow, recovery, and storage limits that are based on the values of the vehicles, which oftentimes are not sufficient for the incident at hand. So when that happens, it makes it tougher for us to get the goods out of storage. And then we have older power units and trailers that have had limits as low as $2,500 for tow charges, which is really a drop in the bucket when you're faced with these high bills. The other problem is that if the truck belongs to an owner-operator and is not scheduled on the insurer's auto physical damage policy, or even worse, the cargo policy, then the insurer for the owner-operator may have limits of coverage for towing that will only cover the vehicles, and then there's nothing left for the cargo. So then it all can come back to us, and we are just left holding the bag for payment. And that is when some creative negotiation needs to take place. So we look to Bob Watson for help and for his expertise. Next, Deb and I have a few examples of some real-life claim cases that we have handled and successfully resolved with the help of Bob. He will be speaking to you later after Deb and I get through these examples. Deb, again, over to you. Well, my two cases include an example of a creative solution and a negotiation. The first one is where we paid the tractor and trailer part of a tow and storage invoice. This was paid so we could have the covered cargo released. The tractor and trailer insurer later reimbursed us, but this wrecker company, like most, would not let the cargo go until it was paid. In this case, when the cargo was released, we then had the cargo transloaded and sent to the claimant for inspection. Our fronting the tractor and the trailer part of the charges saved the cargo from being held hostage by the wrecker and resulted in a positive adjustment since only part of the cargo was damaged versus the total loss. My second example involves an overturn and damage to the cargo. In this case, the cargo had some salvage value. Our policy contained a tow and storage limit of $10,000. However, the wrecker refused to accept the limit and wanted full payment of the charge. The wrecker then threatened to pursue the assured for the difference. To remedy this situation, we left the salvage with the wrecker and negotiated the salvage value to cover their remaining fees. Sharon will now discuss some other cases. Thanks, Ted. I have two cases that I'd like to review. The first one involves a load of lumber. And we recently saved approximately $12,000 on a nearly $50,000 tow bill up in Connecticut with the help of Bob. What happened is this. Our insurer was hauling a load of lumber which overturned on a Connecticut highway of all time during rush hour. The tow company arrived with a backhoe and some dump trucks. And believe it or not, they started loading the lumber to clear the highway. The Connecticut Department of Transportation was not happy with the amount of time it was taking. And so, don't ask me why, but they instructed the tow company to just dump the lumber over the side of the elevated highway. Hours later, the tow yard discovered that the lumber had fallen onto railroad tracks beneath the overpass. This then resulted in many more hours and units being dispatched to promptly clear the tracks. And because of this exorbitant bill, Bob filed a complaint with the Department of Motor Vehicles in Connecticut where tow company billing disputes are resolved. Subsequent to filing the complaint, the director agreed to a reduction of $12,000. So, Bob negotiated it down to $38,000 and then we dropped the complaint. So, all in all, that was a great ending. My second case involved a trailer load of fish and flowers. Yes, fish and flowers being shipped in the same trailer. Don't ask me why, but that's what they did. So, what happened here, it was being transported by our insurers who actually overturned in South Carolina. The insurer reported that the tow yard refused to allow them to pay for the cargo portion of the record charges in order to release the trailer. So, again, we called Bob who informed us that in the state of South Carolina it's unlawful to hold cargo hostage pending payment. Bob called the tow yard and he was able to negotiate a settlement. We expedited payment for the cargo portion and then we arranged to have a salvage the load which was initially refused by the intended receiver since at that point it was over a week overdue. So, we received a net salvage proceeds of $7,000 which has offset a claim for approximately $45,000 and we ended up paying $38,000. And then another great point to this story is the tow yard is now our potential subrogation target as their failure to promptly release that cargo to allow it to be delivered to its intended receiver caused or contributed to the loss. So, to us, this was a very good ending. We know that any time we have viable recovery against a wrecker or a tow company, it's a great day in the neighborhood. Deb, back to you. Well, where tow and storage is involved, timeliness is key. Handling the tow and storage charge immediately can result in the release of the cargo and reduce the possibility of further damage. Once released, the property can either be transloaded and shipped to final destination or salvaged to reduce the loss. We find that in many cases, the storage is the bulk of the charge and the sooner the property is removed from the tow yard, the better the adjustment results. Some ways to handle unreasonable tow and storage would be to either retain a specialist to assist, to contact a wrecker company and negotiate, or another way is to possibly send a letter to the wrecker to immediately address the release of the property. Here is an example of a letter to a wrecker. Please, however, keep in mind that everyone has different policy language and issues. So, this letter is very generic. The letter should be tailored to your needs to assist in future claims. Well, that's it for Sharon and I. Now, over to you, Bob. Bob I'm not sure if your line is muted you might have to unmute it. There I am I'm back sorry about that. You are here. My name is Bob Watson and I appreciate the attendance today and it's going to take me about two hours to go through everything but anyway I am a I was a tower for 25 years and have a lot of experience in the towing recovery hazmat industry. I handle about 25 insurance companies currently and one of my programs I put on is doing joint settlement global settlements and as I spoke on some of the ones prior to this but the as you go forward I don't know how many people out there know what the problem is nowadays and if you look up here towman of the year and what they do is they have about 2,000 tow classes a year and these two gentlemen here they have a class called billing unlimited. Let me see if I make the arrow work here. All right if you look right here it says recovery is called billing unlimited and they they go in there and they teach towers how to bill these ridiculous bills you see nowadays. I've seen where they're charging for headlights on the trucks just all kinds of stuff they they charge for. I was in court last week in Louisiana and the the other prior the other attorney stood up there for 45 minutes and bad-mouthed me about everything I do this and that and it was all based on this big wheel programs they put together. After 45 minutes they finally give up and admitted me as an expert witness and that was for the judge. So as we got into an invoice I looked at it and they were the other attorneys asking me you know trying to say all the problems I have with you looking invoices and I asked I asked the judge I said your honor can you look at that invoicing and you tell what they're talking about? He says no and I said I'm looking at the same invoice. I have a hard time explaining it. Now they're gonna send this invoice out to insurance people that are not familiar with tow bills. They have no idea what they're looking for not looking for. There could be three insurance companies involved in these things and and if and so they can they give insurance company A $10,000 the bill could be $20,000. They'll bill insurance company A $10,000 for the tractor insurance company B $10,000 for the trailer insurance company C for cargo. So you get $30,000 out of a $20,000 bill or if you have multiple trucks involved in these things they bill everybody for multiple trucks and in my experience is that the I can read a bill and see these multiple charges. Now if you look down here it says these boys have gathered a reputation of being shrewd businessmen administrative fee accident cleanup or customary administrative how to turn a non-consensual call into a consent tow and I don't know how many everybody out there understands but a consent a non-consensual tow is a tow from the police department a consent tow is where I called big wheels here I want you to tow my vehicle that's the two different ones the one I had Louisiana last week is that they took a non-consensual tow and turned it into a consent tow and then but they didn't tell the gentleman that owned the truck that they were going to triple the prices and so that's one of the reasons I bring up I'm very win all the time on that because they never tell them they're going to charge them three times higher and then it says right here it says the big wheel is commonly we cover automobiles with is a rotator and billing out a minimum of $5,000 for one hour of hour to work to perform so this is the class as they go down there my favorite one I don't know how you people can read this thing big will may appear to be an operated by a masked men and boy that's a fact all right this is the back page of that the big wheel article the towman of the year and so we'll skip that one move the next one okay industry problems okay the big wheel class towing unlimited they convert a non-consent tow to consent tow they apply numerous hazmat fees that often don't apply to the tow and so they try to take the tractor doesn't have insurance well they take the hazmat fee and they put it on the tractor and they move stuff all over the all over the billing to see where they can this is what they teach in the class how to move stuff around where you get paid and then they determined to bring out the most expensive equipment and this is what it says on the article rotator skid steer flatbeds so industry problems not only companies like big wheel are affecting the heavy trucking industry they also claim to teach towers how to recover automobiles for 5,000 teach towers to utilize item charges such as fuel surcharge to further inflate bills administrative fees we're going to see more of this as we go in here they they come up and like I said earlier they I have one that they charge $110 an hour to use the guy's headlights on his rotator which he was charging he was charging $1,500 an hour already and charge $110 for his rotators they teach and I spoke for 2,000 tours a year all these different tricks and the judge says how do they do that last week in court I so they have a tow convention about 30 I'm across the United States and they bring in the towers come these conventions and they have classes the convention they teach a hundred two hundred at a time over a weekend period how easy way to rip off the you know the insurance industry I call it then I don't know how many of you ever heard of tow 4-1-1 if you go on to tow 4-1-1 they it's a it's a line that's kind of they got all the towers go on there and they brag about who are the easiest insurance companies to rip off who are the easiest trucking companies to rip off so when they they do something and I they do something they rip off somebody they put it on tow 4-1-1 I build these people $30,000 and they paid me well then then the next door says oh that's good I'm gonna build them $35,000 and on and on and so there's like I say there's 2,000 towers it's been going on since 2010 I think the tours are going to these classes now what I've just learned is big wheel is now teaching attorneys to defend these tours is called coastal legal affiliates of Massachusetts and and I've had many run-ins with him global settlements what global settlement is is that like to say there's three or four different insurance companies I had one in Texas a couple weeks ago I had four insurance companies multiple truck accidents I handled all segments of all the truck trailer cargo hazmat and I got the bill so I know what everybody is paying and I can control it and in Texas I've had over 50 and I keep saying I had over we involved in over 50 lawsuits I would say this year and we have an average savings of 58 percent and I think it's coming up later in them and what it is that there's a 14-day hearing process that we can get into that we can get these judgments from the in the courts I've had 63,000 and the judge gave us twelve thousand five hundred dollars and it's a ongoing thing I've had since this month I think I've had five cases down there and every one of them I had one for 32,000 we just settled for $12,000 what I suggest everybody out there is pay every bill that's ridiculous under protests if you got to get it out fast pay it under protest and what that does is I can go back later for instance I have in in Illinois somebody said that Illinois is a bad area to work in I've been real successful in Illinois I just filed and I don't know what everybody knows replevant action is we put a bond up and we get the tractor-trailer cargo out I am fine I keep saying I am I'm involved in filing three lawsuits against one tower that we paid under protest three different times now we're going in and we're filing all at the same time under this one Taurus he's going to get three lawsuits on top of him and there's and he's in for a real experience and somebody also said Oklahoma I don't have problems in Oklahoma Ohio they have new laws in Ohio but if you have a problem make sure you pay it under protest okay is my favorite one I've been called many things by companies like big wheel but my favorite title is the towed terrorists I am hated by the tow industry despised it's unreal but okay recovery resolution is led by Bob Watson that's me and uh and I got over 40 years experience I don't look that old look pretty good I've handled over a thousand cases myself 20,000 cases a year and over a hundred parents in court across the country and I have approximately 28% savings for an average invoices I work on they this is the Texas program I was telling you about and you can if anybody's helping Texas just give me a call they cannot hold cargo in Texas they can't hold in South Carolina there's many states they cannot hold cargo and so I've been very successful as they talked about the fish load in in South Carolina that this tower is going to get couldn't get triple damages for the loss of holding this cargo I have been in court with him before and he lost and so on on the fish load the knowingly holding a cargo he can get three times the damages so we may have a judgment against him for a hundred and fifty thousand dollars plus attorney fees and that's not in every state but it's it's quite often here is this is a example one and I'm going to show you what these bills are this is about a $2,000 tow bill if you look at the very first thing $175 an hour for headsets rotator $2,250 to set it up you got you got the mileage this is all that on the big rig you look at you got a Kubota Ram truck all the way down look at all these charges what this is and then there it is my favorite administrative fee $900 writing this invoice up this is for a truck that slid off in the center divider in the snow all they had to do is hook up and pull it back out and that's how simple it is but this is a big wheel actual bill from big wheel and this is all the stuff they put on there the total bill is ten thousand one hundred seventy nine dollars and the reality it's a winch out but the you look at the administrative fee it just this stuff is ridiculous what they put on there here's the here's my tow bill of the year and I won't go through it real fast but there's page after page there's another page another page and if you look down here let me get my arrow but there it is right there it says one hundred and eighty four thousand seven dollars and eighty four cents and this is in New Jersey and this is a jackknife truck only didn't roll over didn't do anything jackknife we're involved in a a big lawsuit on this one they sued me personally because they said I'm a bad guy and so it's a very complicated lawsuit but we're going through it right now and I can tell you more later but the you everybody out there see airbags and it's all airbags airbags well let me show you how long it really takes to do an airbag job this is an airbag job and if you look down here I lost it where to go anyway this is an airbag job if you look at the shadow of that gentleman standing in the middle you look at the shadow this how long it takes there there it's coming up there it's almost up and there it is setting down right now that's done but you look at the shadow the shadow is still the same it takes about 45 minutes to an hour to do one of these this thing was loaded with cargo I mean tomatoes and the if you look you look back here the guy right there in the orange shirt that's me on my younger days okay this this is a problem that I deal with and storage this is one insurance company if we had 20 units tractor trailer or tractor or trailers and storage for $100 per day we are paying $2,000 per day for storage if you multiply this out for a year at $730,000 in storage fees just just one company what I do is I've changed this company I probably two-thirds that is knocked off from just get these bills in on time get them paid get the checks out and get them out of there and so there's a huge value to moving the cargo around before getting in questions pay under protest get help fast make sure I got all my stuff done here but that's what would say about that's about it but any go ahead we'll go we'll go to questions answers thank you Bob at this time our presenters will take questions to ask a question simply type it into the text box and then click the balloon icon next to it and we'll receive it immediately we'll wait a few moments for questions to come in so once again you'll type in your question in the text box and then click the balloon icon next to it and we'll receive it Okay, we have our first question. What states do not allow cargo to be held hostage? This is Bob Watson. I can't tell you all of them, but I know that Texas, South Carolina, California, New Mexico, I'm going by memory here and that's hard for me, you know, when you're old. There's probably 10, 15 states that do not allow you to hold cargo. Here's another question. Are the police sometimes complicit in these schemes? I say this because I often see tow companies saying they paid the police department. This is Bob again, if you want me to answer it. Yes, that would be fine. Okay, I don't want to answer all of them. It happens quite often. There are areas that I know the police are involved in getting paid off. I ran across it. I was involved with the manager of the New Jersey Turnpike about six years ago, Robert Desano, and I got caught him involved with it, I got the FBI involved in it, and he got arrested and got 18 months in jail and fired. But he was getting paid off all the time by the towers. Happens quite often. Okay, and so we have actually quite a few questions, so if any of the presenters feel those questions, I'll just throw them out and whichever presenter feels comfortable answering the question can chime in. How can we find out what state prohibits holding cargo by law? I can help answer that, and maybe somebody else can do better than I, but I can give you a list of it, but off the top of my head, I can't remember all the states that do not allow it. I would say about 15 states, and I named some of them already, but I'd have to go through my memory bank and figure it out again. Is there a place where they can get that information, Bob? No, no, it's just for me dealing with each state, having problems, and I just learn which ones allow it and which ones don't. It is a federal law, it says interstate transportation, and you cannot hold cargo in any state, but sometimes you have to file a lawsuit to win on such, but you can't, and some police departments do not allow it. State police do not allow it, and other states, you know, you're on your own. I'm wondering, Bob, this is Sharon, if that's something that one of our, say, our trucking attorneys would be able to obtain for us as far as the state. Do you think that's a feasibility? They'd have a good shot at it. The only reason I know so many of these states is because I deal in every state, and I've learned it just from dealing with it, and so I'm not trying to dodge the answer. I'd have to put some thought into the answer. Great. Is there any movement by any entity to have the industry regulated in some fashion? There's rumors out there that they are trying to deal with problems out there, and the only one I know, Ohio, has come in with new laws, and that is with the insurance industry working on dealing with the overcharging in Ohio. Other states, there's, the stuff is going on, but nothing really up front that I can say is happening. I work with many different states trying to implement towing laws and regulations to help the insurance and the truckers out, but it's a slow process. I think the problem is, Bob, that it's really not at the top of the food chain as far as our political arena dealing with these problems, and although that we see it quite often and weekly in our jobs as insurers and agents and so forth, it's really kind of a tough, uphill battle, but something that I think, like Bob said, should be forged dead ahead, and hopefully, at some point, we can overcome some of these exorbitant charges. So related to that is another question. Does anyone know if the insurance industry is working on lobbying efforts to correct the problem? The only state I know is doing something is Ohio, and that's the only one. Nothing from the insurance industry. Nothing. I work with the trucking associations in many states also to help me out all the time to get laws in there against what these towers are doing, but again, it's a slow process. Is it something, Bob, that we as multiple insurers should do together, if you will? I mean, I would think that that would actually kind of hold more power if we went en masse to try to revamp some of these fee structures with these various companies. Is that a possibility? Well, I tell you how to cure the whole problem in about 60 days is that nobody pay a tow bill that's ridiculous for 60 days and file lawsuits. It would stop at this runaway train in a heartbeat, but that's my own opinion. It's difficult out there to get anybody organized enough to work on each state. The best solution out there is to work together as a team and file these actions, file lawsuits, and deal with them one-on-one, and my reputation out there is that, in most cases, that they know that I'm not afraid to sieve up the plate and file a replevin action and get something going. I mean, you go on Toll-411, all you do is see it out there all the time, and they always try to beat me so they can put on Toll-411 that I lost a case, and it's against my religion to lose cases. Right. Okay, thank you. Here's another question. Our motor truck cargo legal liability coverage forms do not have tow storage. We just have debris removal. Please define what is debris removal, as oftentimes the tow storage bills do not itemize debris removal. Yeah, absolutely, and thanks for the question, too. Essentially, debris removal covers removing the actual debris or property that's damaged and undamaged property from the scene of an accident or loss. So like you said, a lot of times it's not specified as to exactly what that could or could not include. So what happens is that you have towing and storage limits in some situations are specified. So you can come out and you can simply say you have a $2,500 limit for towing and storage, or a $5,000 or a $10,000 limit for towing and storage. And then on the back end, they have the actual over-action debris removal limit on, say, $25,000 or $10,000. So you actually pay the cleanup costs as well as the debris removal costs under the debris removal coverage. And then from there, anything for towing and storage falls under that particular heading. So it depends. Again, it just goes back to the kind of hybrid model. So a lot of carriers out there have the hybrid model of putting the debris removal combined with the towing and storage, either look at it or it's not specified. So they'll give you a specific limit for the debris removal, for actually removing the damaged or undamaged property from the scene of loss. But what happens to it after then is really where this comes into play and where the larger of the fees really start racking up, as you can see from what Boshara and Deb were talking about. In many situations, too, when you're looking at it and trying to understand where to pay or how it works out between the two, if it's not specified, it depends on what other situations the claim are, how the claim settlement process is going in. In that situation, you can actually physically try to pay more under debris removal if you don't have a specific towing and storage limit, or if you do have a specific towing and storage limit, and that's been exhausted. Thank you, Sam. Here's another question for you. When the limits of towing are exhausted, what then? Often the insured cannot afford the balance and this results in abandonment of the equipment or cargo. This situation then creates other coverage problems. Yeah, we've seen that a number of times, and thanks for that question, too. That's a really, really good one. And it really boils down to what happens when we exhaust limits in most policies, right? I mean, it simply falls back to the insured or to the responsible party for it. In some situations, I mean, that can be avoided. You know, I mean, in most cases, any debris removal or even towing and storage limit coverages, like so many other things inside of our inland marine policies, are negotiable, right? So we have the ability up front as underwriters to go in there and physically say, OK, you know, especially now that you're armed with more knowledge about the situation that's out there, you can go and you can take a look at it and say, OK, I know I have a towing and storage potential issue, or especially, like we were saying earlier, too, if you consider things like refrigerated goods or hazardous materials or something that's more out of the norm, not what you would typically consider as like a general commodity type thing. So when you're looking at it, you're saying, OK, you're not really going to underwrite around towing and storage like we talked about previously. That's just something that you really have to consider. So like any other limit in the policy, you have additional coverages. And this is where that typically falls, the towing and storage and or the actual debris removal coverage. And so if they exhaust the limits and they pop the limits, then the rest of the amount is going to be on them, which is unfortunate. And that actually, like I said, results in a lot more complicated coverage issues. It extends the law settlement process and the claims process, increases the cost of claims adjustment, and then obviously, it takes the crap out of your policyholder, too. And then they get upset and they get a lawyer. And it gets even more and more complicated. And all the same time, the towing and storage companies are sitting back there laughing at us because the goods are still sitting there essentially rotting on the towing and storage yard. And so when you look at it, too, especially once you get it out of the supply chain for an extended period of time, assuming that if there was any kind of salvageability to it or any kind of ability to actually go in there and physically get any recovery off the goods once they were damaged or even the undamaged stuff, then a lot of times, too, that's obviously exhausting. You don't have the opportunity to do so because these drag out forever and ever because it gets more and more complicated. So on the underwriting side, an upfront, great, kind of good practice, best practice tip is to just be aware of it and understand that petroleum storage issues can arise, you know, that can lead to a larger problem down the road for the rest of the claim settlement process. So, be mindful of that if, you know, you have a specialized cargo or, you know, like I said, it looks like refrigerated loads, especially with the Food Safety Modernization Act and other things that are going to be impacted refrigerated cargo in the years to come. It's more and more important increasingly every day to understand that and to be able to be effective to your underwriting decisions. One thing, a little more behind that is that on cargo, the prior letter sent a demand letter to release the cargo because it's called, they cannot legally hold it, but nobody enforces it. It's called conversion and you can go back after damages on the cargo for holding it. So, that's a, that letter is a great thing to do. And, I mean, you just have to go after these guys and stay on top of them. Don't back down. Thank you. Here's another question for the group. Can you cite the federal law that prevents wreckers from holding cargo hostage? It, does anybody know it? I know it in a minute here. Shoot. I'll come back to that in a minute if nobody knows it's called. Yeah, unfortunately, Bob, I don't know that law offhand. You do? I do not, no. Oh. Bob, while you're looking for that, I'll, here's another question for the group. Sometimes towing companies will include food and drinks in their bills. What are your thoughts on this? If they're 20 bucks or something, I don't argue with them. I got one this morning for $600 for drinks and foods. And, so, I mean, that's what, I mean, I refuse to pay them. I, as an insurer, agree with that. I would refuse to pay them. I would think if they want food and drinks, they could actually bring them to the site themselves. So, I would not include that in any payment whatsoever. I'd fight that. Like so many other things, what's customary? You know, what's reasonable? And, I think that in so many situations when we're looking at things like this and trying to understand what the impact on the policy and our, well, frankly, our loss ratios and claims expense ratios come out to be, you know, that's a big part of it. You have to understand what's reasonable. That's really what we're trying to drive at here is, you know, there's an issue. It's clear out there in the marketplace. It's something that we don't consider necessarily every single day because a lot of times, especially on the underwriting side, we're removed from the claims side in a lot of situations. You know, so while we see the account and understand the ins and outs of it from the up front portion of it, you know, on the back end when the claims go to settlement and go through the adjustment process, we're not really there, you know, frankly, most times actively involved in it. And, so, we lose sight of exactly what goes on behind the scenes. So, it's always important to look back and try to increase the partnership you have with the claims organization. And, physically, like I said, again, try to be as good partners as you can to those folks and help them as much as possible, both on the underwriting intent standpoint, on the coverage standpoint, and then on a partnership level to be able to create open and clear lines of communication between the two groups. Can you provide any tips on how to pay under protest, and what are some of the techniques? What I do on it is that sometimes I'll send a letter to the insurance company and describe what's going on and have them send a letter to the towered with a check and say we're paying this under protest. The normal way I do it, I just put it on the check, this is a disputed bill. Pay under protest, and just putting something on there like that is as simple as it has to be. But, Bob, doesn't that make it more difficult for us to get our money back? I mean, are we throwing kind of good money after bad if we make a payment under protest and then try to get it back? Well, the way I do it is if there's an emergency and we have to get something out of there that's got a big value to it, we have to pay it and get it done. And I worry about the recovering the money on the backside. In most cases, I'm on your side, I don't want to give a towerer $50,000 and then have to go back out and try to collect it. It's easier to collect it when you owe it to them than it is when, you know, when they got your money. So, I'm against paying under protest. I only do it when it's up against the wall and there's no other way around it because of some type of emergency. Okay. Thank you. Okay. Here's another question. We've seen issues when one insurance company insures the vehicles and another insures the cargo, but the tow yard won't release either separately. How can this be resolved when there is coverage for other issue involved that delays payment in order to release the property? I run across this. This is Bob again. I run across this every day. I do about 10 truck accidents a day and about 50% of them all have multiple people involved in it. The towers always say, I will not release it until I'm paid in full. So, it's something I have to deal with. Like right now, I have one in California I worked with and I got them to release the cargo this morning without being paid. But they, you know, I have to swear I'll pay it and all that kind of stuff. But in most cases, the towers will not release anything until they get paid in full. So, it's just something you deal with every single day. You know, Steve, we run into that quite often. And what we try to do is, of course, contact the other insurers for the physical damage portion and try to work with them and paying them, you know, all together if we can. There are times that we pay the bill with the promise of getting it back. We certainly don't like to do that and we don't do that often at all. But if we have a high-valued load, like Bob just mentioned, we have in the past paid the bill and then thought, you know, reimbursement from the physical damage carriers. But we try to avoid that at all costs and try to negotiate on the front end to make it easier for all the parties, like Bob mentioned, to get a global settlement before putting our money out there. So, it's a case-by-case basis. It can be a very tough situation. But I think, you know, once that money's out the door, sometimes you're not seeing that come back in. So, you have to be very careful of that. This is Debbie. You could also send the letter, the draft of the letter, to the RECR with a promissory note that you're going to pay for your part of it, if they allow the cargo or the property, if it's a high value, to be released. A lot of times, the RECRs will accept that so they know that at least that part is being paid and they'll release it. Okay. Thank you. Here's another question. What is the best method, negotiating attempt, a claim examiner can take with the RECR to reduce costs before we contact a firm such as Bob's? Just to dig our heels in, Mike. You know, we tend to look at those bills very closely, as Bob said. Look at all the list of items that they have enumerated. Try to knock off what we think is really not relevant. And then we just start with an offer. It's tough, but I think, you know, after you do it, after a certain amount of time, you kind of, you know what is reasonable and what is not. And it's just a question of really, you know, digging your heels in and offering what you feel is reasonable. And if they don't accept, you know, at least you made that effort. And then I really don't want to say that we go to Bob to resolve it for us. You know, we might go to him for some advices, but on the front end, we just do our best to try to work with them and come to a figure that seems like, you know, it will work for us. Thank you. And related to that question and answer, are there any resources available for claims adjusters to learn more about the towing and storage process that would allow them to be more educated in contesting and battling these inflated bills? Well, I can help you answer that, but the way I like to do global settlements because I can get three different insurance companies or whoever, money in one hand, and now I got $50,000 to deal with instead of 10 here and 10 there and 5 there. It's easier to do global settlements, and I'm very successful at that. The question you have right there, that's right, what was that question again? I missed it. So are there any resources available for claims adjusters to learn about the towing and storage process that would allow them to be more educated when they're contesting the inflated bills? I got off the track, didn't I? I go to insurance companies, and the problem is that I've been on little seminars at different insurance companies and talked to them about it. The problem is the people handling the claims have so much on their table, they really don't pick up what I'm trying to lay down, and it's from years of experience. It's very hard to teach, you know, they get turnover, they get new people. It's very hard to, there is no class to teach anybody, so, and if you do have a class, it's hard for them to remember what I'm really talking about. But I think the most important thing, Lillian, is, you know, looking at the situation, looking at the claim at hand, what happened? Was it an overturn? Was it just a soft layover? Was it a collision? And then you can kind of, you can kind of gauge, yeah, I guess maybe from experience, you know, what type of equipment is needed, how long it might be needed. And yes, you can call Bob and say, Bob, what do you think, should it be four hours, should it be 10 hours, should it be 45 minutes? So I think it's maybe, it's kind of, a lot of it's on-the-job training, and just the experiences that we see on a claim-to-claim basis. Thank you very much. We just have that one last question, and that was the, citing the federal law that prevents wreckers from holding cargo hostage. And if you could email either Eileen or myself, we could then, you know, send that response to the one person. Okay, I have it on my computer here, but I've got the other program on there, so it's, I can't dig into it. Yes, yes, so you can email it to us afterwards, and that would be fine. Thank you so much, Debbie, Sharon, Bob, and Sam, for a very informative presentation. Thank you also to our attendees for your participation and your interesting comments and questions. All attendees will receive a survey with a link, a link with the survey for feedback. Please take a moment to respond to the survey and provide your feedback to IMUA as it will help us with future programming. This ends today's webinar. Have a great rest of the day. Thank you. Thank you all. Thanks.

Towing and Storage Fees

Motor Truck Cargo Claims

Inflated bills

Tactics of towing companies

Insurance carriers

Policyholders

Negotiating fair fees

Paying under protest

Bob Watson

Policy limits

Regulations and standards