A growing number of communities across the country are choosing to enforce an accident tax, also called a crash tax. However, many motorists have no idea what this tax is or when they might have to pay it.
If an out-of-town driver is involved in an accident, and emergency workers are dispatched to the scene, they may be sent a subsequent bill for services rendered if they are found to be at fault. There are currently 26 states with some form of this tax, as local governments are increasingly struggling to pay their bills, according to MSN. Bad weather may lead to increased auto insurance rates, and it looks likely that these taxes may also affect your insurance quotes as insurance companies look to cover the cost of this tax with increased insurance rates.
However, many local officials do not support this new tax. In certain states the number of drivers slowing down to potentially dangerous speeds in order to avoid getting into a crash and incurring these fees may be making local roads less safe.
Some cities have taken these issues into account and banned the crash tax altogether, but other communities continue to add the fee to their local bylaws.
What may be an even greater problem is that many towns assumed auto insurance companies would pick up the cost of these services, but many of them do not.
An industry lobbyist with the National Association of Mutual Insurance Companies told MSN that insurance companies may not cover these fees because “it is our belief that local taxes pay for those.”
These costs can vary anywhere from $28 to $2,200, depending on what type of services may be needed. In Florida, individuals may be charged $28 an hour for a police officer, and $1,000 for accident extrication. The bad news is, these taxes may affect the cost of your car insurance quotes.
Some insurance companies feel that if these costs and fees continue to gain in popularity they could force rates up across the country, the media outlet reports. A carrier may place a cap of the amount of these fees it will pay.
“There’s going to be more and more pressure on cities as their budgets are tightened or cut and on fire and police departments who obviously never have enough money to run their departments,” Mike Lane, a lawyer and lobbyist for State Farm who opposes accident response fees, told MSN. “If they can do it and earn a little extra, more are more likely to try it.”