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Laws allowing local cities and governments to collect a fee for the cost of handling accidents have been on the books for years and many have. Now, in these tough economic times, even more cities are revisiting the possibility, especially in California.

The basic idea is that the charge – called an accident fee or crash tax – allows the locals to recoup lost costs spent on handling accidents. In some cases, motorist’s insurance policies would cover the tax; however this is not always the case—leaving some policyholders stuck with the bill.

Sound farfetched? It’s happening in at least 24 states. Though ten states – Alabama, Arkansas, Florida, Georgia, Indiana, Louisiana, Missouri, Oklahoma Pennsylvania and Tennessee – have banned ‘crash taxes.’

While reading through the many news articles reporting on this very topic it’s hard to find the upside when everyone is in a fury over the fees which can range from $435 every time the Fire Department shows up at an accident scene, to $680 if a vehicle is on fire, to $2,275 if a helicopter is called in. And again, those fees vary area to area.

The crash tax may help to reduce accident rates if drivers fear receiving a hefty bill in the mail from the city along with any physical pain caused by the accident, not to mention medical bills. But at the same time, you have to wonder if drivers will be more reluctant to report an accident knowing they will be hit with a large bill.

What you should do if you get billed for accident response:

Contact your insurance agent and forward them a copy of the bill. They will inform you of your obligations.

Get a copy of the police report detailing what medical assistance was required, if any.

Research criminal liability; nonpayment may be a misdemeanor.

If your insurance agent determines the bill was not warranted, contact the consumer-protection division of your state attorney general’s office.

3 Comments

  1. Since most cases are simply negligence and not intentional I don't see a direct help. Maybe, they would make people think a little more about speed and drinking when driving, but there are already laws concerning those. In many states it's the insurance companies that are fighting the tax.

  2. Gravatar for Shanna

    Maybe they just want another reason to have another tax. People can not take responsibility for anything. We are to quick to say its the taxes or the insurance companies. It's either one or the other motorists fault and they should have to pay for the damages. Its called consequences.

  3. Gravatar for sree

    Actually, Oklahoma only banned "law enforcement" response. Fire Department isn't considered law enforcement so cities are actually charging for Fire Dept. response.

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