I got a couple of comments on my blog below on the new “Parking Ticket Insurance” scheme not under way in Philly. Check this out:
Social commentary aside, this seems like a pretty thin margin for the company or they are taking the position that you will likely not receive many parking tickets in Philadelphia. Meter tickets are $36 and 5 tickets covered under the “basic” plan assuming they are all for meters is $180. The “basic” plan is $99.99 and $9.99 per month, offset by a $10 Meter Card. If you get 5 or more meter tickets per year this is a no-brainer as you are basically paying for the service and the peace of mind that your tickets will never go into a penalty phase. Throw in a couple of higher dollar violations into the first five and you’re ahead of the game.
From a commercial business perspective, if you own a fleet of vehicles that rack up parking tickets and penalties, not to mention loss of man hours when a vehicle gets towed or booted, it’s a simple cost/benefit analysis. Don’t forget that you can probably write off the service as a business expense which is something you can’t do with parking tickets.
All in all, capitalism at its best (or worst if you initials are JVH).
Those initials appear to be mine – So here goes – As a business model, its classic insurance and as long as their stats are correct, they will do OK. (I don’t know how much actuarial info is one file for parking tickets, but there you go) They are assuming that most people will use the program to make their lives easier and not try to run up their number of tickets to make a profit on the deal. My guess is that someone that would use this type of service most likely already gets a lot of parking tickets so they need it.
It will take the IRS about 15 seconds to see through this and deduct the cost of the tickets from the service provided and allow only the service, not the tickets. That’s what they are all about.
An Aside: UPS and Fedex saw parking tickets as a cost of doing business in Manhattan and cut a deal with the city to pay them direct. Worked out well. Then the city installed P and D meters and allowed the drivers to take the parking with them. In other words, when they bought some time, they could use it anywhere.
But in the end, they are selling a service to a willing customer. That’s capitalism. However there are many services that we have outlawed (prostitution, drugs, money laundering, the list is endless.) I’m not saying that this service is equated to one provided on a local street corner, but I’m sure that Peter’s model of the UK rules will kick in soon. Sure, you can use this system but if you don’t pay in person, or with a personal check or credit card, you will be surcharged. After all, part of the fine is the hassle you go through paying the ticket, isn’t it?
As we make it easier and easier to subvert the law, and simply have to pay a fee and get around the “problem” then the lady with the blindfold begins to peek a bit. Those with bucks can get by with arrogance, and those without bear the burden.
JVH
