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I am sorry about missing this post and replying to it..

The rates are a bit of history when dealing with the Price Per Pound rates...

First of all when Stormin Norman created PPP back in the late 1980's, he discussed the problem of with several towers and industry people.. He wanted to make the system fair while using modern equipment to do the job.... (take the examples now of the Florida Quick Clearance program and the Georgia TRIP program) where you are having to do the jobs in 90 minutes... Do you want to do that kind of work on Hourly rates ???

Now when he started using the system he had figured out what rates worked for his area of operation, which is Southeast Alabama where there are no interstates (Interstate 10 is closest at 42 mile away) and a lot of 2 and 4 lane State Highways ( I am still down here working for another company in the same area) and as such he used rates which would cover his expenses and return a bit of a profit... That is the key in the rates, but remember that the rates are not set in stone... We know that the rates and expenses in New York are different than in California, than down here in rural Alabama.

Now the orginial rates were much lower than they are now (inflation or cost of living) and as such the rates are now what makes the profit and covers the expenses. The rates we are using were figured up in 2004 and most likely will get reviewed and increased soon due to increased costs of doing business.

Now as to why it is 8 cents per pound instead of 10 or 20? Well the system was created to be fair to everyone involved, and not rip off the customer be it the trucking company or the insurance companies. If you are not sure how the system works, go grab a few of your old recovery bills which you used Hourly rates.... Take and figure it using the PPP system and see if they are close in price. Usually they are not that far off.

And yes, using PPP can either make you lots of money on some jobs and it can be where you "loose" money on some jobs... It is a time based reward system in an extent that the amount of equipment and people you bring to the scene cost you money. You now have rotators and air cushions which make the job much easier and while they cost more to purchase and keep around for the "BIG ONE" you are now doing the job with less expenses (if that makes sense to you)

Instead of maybe 3 trucks and 6 people you have 1 truck and 2 people, and tend to do it in half the time. That is the risk - reward part of PPP....


So is it clear as mud now ?

A very good statement at the end Jim...

Yes PPP is great and it does protect the insurance company or trucking company from "overloading the scene with equipment" and at the same time it also does reward the tow company for having the proper equipment and training and being able to be efficent.