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What is Roadside Assistance

What is Roadside Assistance

A brief history of roadside assistance:

Roadside assistance is a form of insurance. It started with AAA, which had been organized to advocate for road building in 1902. Its Illinois chapter added roadside assistance in 1915. Soon all the AAA chapters offered it.

AAA faced minor competition until after World War II. Then, the President of Montgomery Ward wanted to give credit card holders an extra service. (This was before Visa and Master Card when consumer credit was largely a retailer function.) He organized a national network of roadside service providers.

But this network, later known as Signature, ended up being more successful as a wholesale operation than a retail one. Soon, Signature provided service to nearly every gas station/brand. And soon Montgomery Ward went out of business.

Signature and the other networks that followed marked in largely the same way: We’re just like AAA. Better World is the first auto club to say: We have the same 24/7 nationwide service as AAA, but otherwise we’re nothing like them.

AAA has had a huge effect on roadside assistance: When AAA started, nearly every gas station also did car repairs; nearly every gas station also had a tow truck or two. AAA paid them very little to dispatch a truck because it was a “loss leader” for the station—just the marketing cost of getting a new repair job. A loss leader is a product or service that is undervalued intentionally to draw folks to additional, more expensive products or services. In this case, repair stations accepted low payment for the referal because they made up the loss of picking up and towing people though repair services.

But that all changed with the 1973 oil crisis. When OPEC was organized and stopped selling oil to the U.S. during the October Middle Eastern War, gas prices more than doubled in the U.S. Sometime thereafter, gas stations increasingly gave up their repair bays and tow trucks.

Towing was no longer a “loss leader.” The companies that took the gas station’s place were towing companies—and they needed to get a market price for each tow.

So, towing is no longer as cheap as it once was. And AAA is not held in favor by most towing companies because they have not fully adjusted their payments. Better World Club has been told by more than one service provider that, say, in a snowstorm, AAA members are picked up last. Not first. Last. This is probably because AAA still leads the industry in poor pay for service providers.

Auto clubs remain a very good deal for members though. A Better World Club Basic Membership is $58.95. One tow of 5 miles is likely to cost you at least $75.00. Assistance in changing a tire would cost you the $58.95, if not more. And on top of that you have the convenience of just calling an 800# to receive the service. You don’t have to contact numerous providers to find one that’s available.

So, if you are only using the service every 1-2 years, Better World Club pays for itself. And if you take advantage of our discounts, you never have to use the service at all for it to be worth it to be a member. Book 3 nights in a hotel through Better World Club--or perhaps 2 nights and rent a car--and you’ll likely cover your membership fee.

Roadside Assistance, as an industry, is a bit off-kilter from the actual value of the service provided (ourselves included); however, our service is an incredibly valuable part of your transportation safety kit, we are not using roadside assistance as a "loss leader," and we have made our service as affordable for our members as we can while remaining industry competitive for our company.


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