Ford Credit will launch an auto insurance product for its commercial business early next year, expanding Ford Motor’s Ford Pro suite of solutions for commercial vehicles.
Ford Pro Insure is expected to go live in the first half of 2023 and is powered by Pie Insurance, which provides commercial insurance for small businesses and handles distribution, underwriting, servicing and claims, Ford Credit said, noting that the captive’s commercial financing unit will work with the insurance provider. The insurance will cover commercial vehicles purchased through Ford Pro as well as other channels.
Commercial auto insurance, unlike individual vehicle insurance, must cover multiple drivers operating a single vehicle and is often more expensive, Jim Drotman, Ford Credit’s executive vice president of Ford Pro FinSimple, told Royal Media.
“The mileage is different. The times of day the vehicles operate are a lot longer, typically,” Drotman said, noting Ford Credit’s insurance product will likely target smaller commercial businesses. “For the smaller fleets, they were looking for more transparency in the commercial auto space, trust with a good provider and value.”
Ford Pro Insure’s policies will include coverage related to liability and collision repair, similar to that of consumer policies, he added.
“From a commercial customer standpoint, they want to look at their liability limits if a driver got into an accident, so it may be different than what a consumer would want,” Drotman said, noting that more details will be shared as Ford Pro Insure is built out.
Ford Credit has been working to launch a commercial insurance offering for more than a year, Drotman told AFN, adding that Ford Credit’s commercial line of credit customers increased 23% year over year in the third quarter.
“We learned that there was an opportunity in this space, particularly around Ford Pro and all the services that Ford Pro is offering to the customer,” he said. “From that perspective, we said, ‘How do we develop a product that can hit the market in the most time-efficient manner, with the expertise needed, and learn and grow?’”
Ford Credit already provides dealers with floorplan insurance through its subsidiary American Road Services Company, Drotman said. “We’ve got that capability … and [Pie Insurance] does a lot of the things that we’d like to do.”
Customers who already finance their commercial vehicles with Ford Pro FinSimple can purchase the insurance at the same time, he said, noting the insurance is still underwritten separately from vehicle financing.
“We’ll have our insurer model that underwrites customers, and then we’ll have a totally separate mechanism to underwrite the financing for leases and loans,” Drotman said.
— Additional reporting by Joey Pizzolato
This story first appeared on Auto Finance News, a publication of Royal Media.