Fuel Capital‘s newly lowered insurance requirement have spurred origination growth, Manager of Data and Analytics Blake Henke told Powersports Finance.
Previously, Fuel was using insurance coverage that was standard in the auto industry. Borrowers were paying $150 to $200 per month, which Fuel learned was “a lot” for its riders, Henke said.
“We were using an auto liability coverage requirement, which is a bit exorbitant when you think about it for a motorcycle accident,” Henke said. “The damages being caused aren’t anywhere near the value that an automobile accident can cause.”
The lessor lowered its payments to match the motorcycle industry standard, which is “roughly half” of the auto standard, Henke said.
“We have gone down to more of a motorcycle industry standard, whereas we were at the auto standard before,” Henke explained. “We’re seeing a lot of uptick in applications and conversions because it’s a more affordable package.”
Fuel made the change on June 28 to correspond with the addition of 12 metric brands to its financing program. After the launch, the company broke its record for highest origination volume in a single week, Henke said without specifying. Even with the new brands being financed, most of Fuel’s originations have been for Harley-Davidsons, he noted.