Watch out for storage fees after a car accident!

After a severe car accident, your vehicle may be stored at a "storage facility."  Usually your car will end up at a tow yard (or an auto body shop).  Tow yards (and similar storage locations like body shops) usually charge about $50 to $60 a day for the privilege of "storing" your car.  Basically, it's an expensive parking lot!  In short, storage fees can be a big pain!

So here are some things to keep in mind about storage fees:

First you have to ask yourself: "Who is going to pay for the storage fees?"  If you have collision coverage (your insurance company covers your own property damage), then report the accident to your insurance company as soon as possible - the same day of the accident if you can.  Tell them where your vehicle is so they can examine it as soon as possible.  Your company is keenly aware of storage fees (they want to avoid them as much as you do), so they might tow your vehicle to their own storage location in order to reduce storage fees.  Many insurance companies have their own storage locations, so they often try to get your car out of the storage facility quickly in order to reduce storage costs.  

Basically, by contacting your insurance company quickly (i.e., right after the accident), you are putting the ball in their court.  If you wait a few days, they might try to hold you responsible for storage fees due to your delay.  Some insurance companies do everything they can to save a dime.  They might only pay for storage from the date you notified them moving forward.

If you have collision coverage, you can still present a property damage claim to the other party's insurance company.  However, this can lead to the following frustrating scenario we see all the time.  Here's how it unfolds:  

You contact the other party's company, and they tell you they need to "contact their insured/client" and they need to "investigate" liability.  The problem is this can take several days or sometimes several weeks.  What if their client denies fault.  What if they can't get a hold of their client?  What if they can't get a hold of witnesses who supposedly support your version of the accident?   What if they want to review the police report, but the report won't be available for at least 2 months (especially common with the LAPD)?  

All this can lead to delays.  In the meantime, your vehicle is stilling in storage and incurring fees. So let's say 4 weeks later, the insurance company for the responsible party finally accepts responsibility.  Guess what?  They probably won't pay your storage during those 4 weeks!  Why not?  They will argue they acted reasonably and your storage costs were too high, or you didn't move your vehicle to a "fee free" storage location (like your home).  If you're lucky, they might offer you "reasonable" storage fees of about 10 days, even if your car was in storage for over a month while you waited for them to figure things out.  

Basically, if they drag things out (whether it's reasonable or whether they are simply incompetent), that is usually going to be to your detriment. Is that fair? Is that "justice?" Probably not.  However, while you're waiting for them to do the right thing and while you're waiting for "justice," you are only incurring additional storage fees.  If they never pay your storage fees, then you're basically stuck and may have little recourse short of filing a lawsuit.   Now if you are bringing an injury claim, you can try to raise the issue of storage fees later on, but even then, it's a frustrating endeavor.  Many times, people get preoccupied with "what's right" or what is "just," and this preoccupation does nothing but make them more frustrated. There is the way the world "should work," and then there's the way the world DOES work.  Being keenly aware of the latter is better for you in the long run.

Now if you don't have collision coverage on your car, then you are unfortunately beholden to the responsible party's insurance company.  In other words, your options are severely limited.  If they admit fault quickly and take care of your car, that's great.  However, if they start telling you it's going to take a while before they determine what they are going to do, you need to make some decisions about your car as soon as possible.  Try to get your car out of the tow yard (or wherever it is).  Remember, the storage fees are only getting higher every day. If your neighborhood allows it, get your car to your property and put a cover on it so it's not an eye sore!  Do whatever you can so you don't get stuck with ridiculous storage fees.  That's one of the downsides of not having collision on your car. 

What is my recommendation?  If you have collision coverage, I usually recommend using your own insurance company.  They have a contract with you and a duty to act in good faith.  The opposing insurance company doesn't have the same duty. They don't even have to return your calls! If you simply cannot afford the potential deductible that will be imposed on you, then go through the other party's company. However, if things start getting delayed, then go back to your company and get things moving.  Dealing with storage fees is often very frustrating, but if you understand what's going on, and if you're aware of this dangerous fee, then you will be better prepared to handle it.

If you've been involved in a serious auto accident in Santa Clarita, Newhall, Castaic, Stevenson Ranch, Valencia, Canyon Country, or surrounding communities, feel free to call our office at (661) 414-7100 to see if we can help you with your accident case.