Insurance Gaps and Financing Issues for Off-Road Vehicles in North America
2019-01-14 13:37 Monday
Due to a growing consumer preference for leisure activities including mountain hiking, winter sports, adventure racing and motocross events in North America, the off-road vehicle market is expected to increase at a 5% CAGR over the next five years. However, the industry still faces challenges related to insurance and financing solutions.
In Canada's Ontario Province, off-road vehicles are required to purchase liability insurance, yet some types such as golf carts, power-assisted bicycles, motorized snow vehicle, tractors and self-propelled farming vehicles are exempt。
Generally speaking, the commercial property owner is found 10% liable and drivers 90% liable, in the event of an accident. However, if the recreational vehicle has no insurance, the vehicle owner may be liable for the entire court-awarded settlement to a victim. The victim is free to sue both the driver and the property owner.
Due to uncomprehensive insurance policies for off-road vehicles, certain drivers face coverage gaps.
Designed to allow consumers with mobility issues to enjoy the same outdoor recreation as friends and family, Terrain Hopper entered the U.S. market last year.
The off-road vehicles produced by the company can travel across terrain that an ordinary wheelchair would find difficult, such as the beach or a rocky hiking trail. The starting retail price for the Terrain Hopper is $18,000. However, with multiple add-ons such as joystick steering and maximum battery strength, to the price can be as high as $25,000.
To make the product more affordable, the company has established a financing partnership with American 1 Credit Union, enabling customers to own the vehicle through financing."Over the course of the last year, we had hundreds and hundreds of people contact us and say, 'Do you guys offer financing?'" Chief Executive Todd Lemay said. "And it's always been, 'No, we're working on it.' Well, now that we have the financing, we're reaching out to some of those people and letting them know that financing is now available. Some of them are now going through that process. We think that over the course of the next maybe two to four months, especially after the holidays are over, we'll see an influx of orders that are being financed," he explained.