A Critical Look at Ontario’s New Licensing System for Tow Companies

In 2020, the premier of Ontario, Doug Ford, made the bold statement that he was going to rid Ontario of the nefarious players in the tow industry. Premier Ford recognized that the vast majority of the towing industry are honest, hard-working people, but the problems of the day (arsons, shootings, etc.) would not be tolerated, and he would clean up the industry.

Ford’s statement led to various committees and task forces meeting with industry stakeholders and concerned parties in an effort to bring about legislation that would allow for an accounting of who was actually in the towing/storage industry, both businesses and individual operators. The Provincial Towing Association of Ontario (PTAO), now known as the Professional Towing Association of Ontario, has been advocating for a provincial licensing system for many years.

The PTAO’s thought process on provincial licensing is that it would eliminate individual municipal licenses; it would identify all players in the industry, save the industry thousands of dollars in licensing fees, and it would allow for an accounting of everyone in the industry.

By accounting for and identifying everyone in the industry, provincial licensing would allow for easier communication with the industry and for more cohesion in the industry. It would also help unify towers, both employers and employees, for more industry protection against abuses by insurance companies and by consumers who choose to abandon their car rather than pay for any tow or storage costs.

During the consultation process for what eventually became known as The Towing and Storage Safety and Enforcement Act (TSSEA), the PTAO sat in all meetings and offered the insight of our decades of experience. The PTAO explained the processes that work in the industry and expressed industry concerns regarding payment for services rendered. The PTAO reiterated time and again the fact that the towing industry is the only privately owned/funded responder to an accident or law enforcement tow request, and it responds with no assurance of payment, often with no accurate description of what the scope of work will be.

The fact that the towing industry also needs some protection was a common thread in the PTAO’s input. During these meetings, representatives from the government nodded appreciatively as though they understood the intricacies of the towing industry. They agreed on the absolute importance of the towing industry with respect to the safety of motorists, and the importance of the towing industry in maintaining the flow of commerce. They agreed on how dangerous the job can be when motorists don’t observe the Slow Down, Move Over laws, and they agreed that tow businesses cannot work for free. They agreed right up to the point of putting pen to paper to support the industry.

Then, suddenly, the focus seemed to shift. The concerns of the insurance industry seemed much higher up the ladder of importance. It’s amazing what high-priced lobbyists can accomplish. The concerns of the voting public jumped to the forefront; it’s amazing what the power of a vote can do.

In the last 10 plus years, the insurance industry has sold the Ontario government a bill of goods several times, a bill of goods that promised insurance premium savings for Ontario motorists, savings that unfortunately never materialized. All the Ontario government had to do was “clamp down on the towing industry,” and the insurers could offer their customers untold savings—untold savings because those savings NEVER HAPPENED. Yet, the Ontario government took the bait and wrote legislation after legislation designed to infringe on the towing industry’s ability to function and prosper, and all the while the profits of the insurance industry grew.

To add insult to injury, the insurance industry has declared the towing industry a “high risk” and started jacking our premiums. It is not uncommon to hear towers that are saddled with 100%, 150%, and even 200% increases in premiums with no claims!

Now, the coup de grâce—the government is poised to deliver what may very well be the final blow for many tow companies. As of the time of this writing (mid-December), how the TSSEA legislation will be put into effect has yet to be made public, legislation that is due to take effect January 1, 2024.

The legislation is full of clauses that allow the government to tweak the wording, and as such, the intent of the legislation. One thing is for certain, of everything I have read with regards to TSSEA, I have yet to see one single mention of protection for the towing industry. It appears that the government has taken the right to control the destiny of the vehicle from the registered owner and given it to the insurance industry. The insurance industry will be given the right to engage directly with towers, and consent to towing services, vehicle access, and the ability to request the release of vehicles.

As I read it, even if the registered owner wants a vehicle to sit tight in a storage facility until a settlement is reached with their insurer, the insurance company will have the right to demand release. As mentioned, there are numerous references to protection for the consumer and protection for “third parties” (insurance), but there is nothing for the injustices that the towing industry faces daily—injustices that we, as towers, have for some unknown reason just come to accept as part of doing business.

There is no other industry in the nation that does their business with no assurance of payment; there is no other responder to a request from a government entity to respond to a government-owned roadway to clear that government-owned roadway; there is no other responder that goes and does their job with no respect, no support, quite literally risking life and limb, only to be told at the completion of their job that “it is a civil matter” to get paid. BULLS**T!

At the outset of the TSSEA consultations/meetings, I was an avid supporter of the idea. I am still an avid supporter of the concept, but I’m sorry Doug Ford, your government has dropped the ball! The people you are trying to eliminate from the towing industry have already found ways around your legislation. The professionals you need to have in the industry are throwing up their hands in dismay and readying to leave the industry.

I, for one, have had it. I will no longer work for free. I have solid, loyal customers that I can work for who appreciate my services and pay their bills. The insurance industry can kiss my bald head. I don’t own the roadways in Ontario. I am happy to come and offer a professional service to keep Ontario’s roadways open, but I must get paid, PERIOD. This may mean some structural changes to my business, but I would rather downsize and get paid for 100% of my work than operate at status quo and lose money on 20% to 30% of it, having to fight every insurance job in court to get paid.

Further salt in the wound is a new scheme the insurance industry is ready to launch that will see owners be offered a discount if they “opt out of” Direct Compensation Property Damage coverage, coverage that allows for repairs or replacement if a vehicle owner is involved in a “not-at-fault” accident. This scheme will allow the insurer to offer a discount to the vehicle owner with the caveat that if the owner is involved in a “not-at-fault” accident, the insurer will not pay for ANYTHING—no vehicle repairs, no vehicle replacement, no towing, no storage, and possibly not even any injury claims.

Human nature being what it is, with times being as hard as they are, I have every confidence that there will be lots of vehicle owners jumping at this option and gambling that they won’t get in an accident. The insurance industry just increased their profits by millions of dollars, all with the government’s blessing. For the towing industry, this means one thing—substantially more unpaid tows and abandoned vehicles to deal with.

There have been rumblings of “job action” or “a strike” by towers since the TSSEA details started to leak out. In the past, I was dead set against anything like this; however, it has become painfully apparent that the government just doesn’t get it. They don’t understand or don’t care how vitally important towing is in day-to-day life, and how important towing is to the safety of motorists and the flow of commerce.

For these reasons, I fully support a tow company’s right to take job action to protect their livelihood. There is no argument that can be given that can justify expectations of any private company to complete an emergency service on a publicly-owned roadway without assurance of payment. This is simply a ludicrous idea. Just because that’s how it has always been does not make it right.

So Premier Ford, the ball is in your court. Your government can push this legislation through as is and let the chips fall where they may, or you can sit down with the industry in good faith and honest effort to put forward legislation that will actually work—your choice. But if the government doesn’t get this right, the long-term effects will be devastating to the towing industry, and as a direct result, the motorists of Ontario. 🍁