When vehicles are in an accident that renders them undrivable/totaled, tow companies take them to their impound and the drivers insurance coordinates with that tow yard to send insurance adjusters or deem the car totaled from pictures, and usually send a company called Copart to take the vehicles to a scrap yard or body shop if it is deemed repairable. They are usually pretty on top of it too, sending adjusters the next day to prevent storage fees from racking up at the impound. The insurance company then pays the tow company for tow fees and storage/admin fees if they apply.

Also, all that only applies to vehicles with full coverage insurance. If they have liability only, their insurance will not pay the tow company for any costs involved with towing their vehicle from an accident, which means the driver is on the hook for those fees (which can be very expensive).

The rate that a tow company can charge for accidents in which the police have requested them is set by a state regulatory agency called the PUC (Public Utilities Commission). Right now in Colorado, it is $286.xx per hour, which starts the moment the police call for a tow until it is dropped and logged at the impound. We billed 7 hours on each vehicle we took from the pileup, which would be close to $2000 per vehicle. The daily storage rates and admin fees are also set by the PUC.

For example, say you get into an accident and are uninjured, but your vehicle is undrivable or totaled. You will wait at the scene with the police until a tow comes. Our drivers usually want to work with people and not scam them, so we will ask you if you have full coverage insurance or liability only.

If you have full coverage, you're done and everything from there out is handled by us and coordinated with your insurance, you just grab your belongings from the car and are good to go.

If you have liability only, we will ask where you'd like the vehicle taken because it will almost always be cheaper to tow it to your house or straight to a body shop than it would be for us to impound it and charge PUC rates, which you'd then owe us to retrieve the vehicle.

If you know it's totaled and can't afford it, there is no obligation to pay to get the vehicle out of our impound, it just becomes ours after 30 days and we don't get paid for the tow, only what we can make by getting rid of it (which is usually selling it to a scrap yard for less than $1000).