When searching for auto insurance, it is important to assess what facets of a policy matter to you. Some shoppers focus solely on finding affordable rates, while others value having more coverage in the event of an accident. Auto insurance is offered in a range of options and levels and typically can be tailored to your individual needs.
If you are looking for a policy with the cheapest price, your research may lead you to broad form car insurance. This type of insurance is typically fairly inexpensive. However, it only offers very minimal liability coverage. Broad form coverage can be a good option in some circumstances, but if you opt for this minimal insurance solution, you may want to better understand the policy and what it covers.
Broad form car insurance
Broad form car insurance is an auto insurance policy that extends liability coverage to only one driver. Broad form policies are intended to be an inexpensive car insurance option. The listed driver is the only person covered to drive the insured vehicle. The only coverages included are bodily injury coverage and property damage coverage, which are designed to pay for injuries or damages that you cause to other people. No coverage is provided for damages to your car or for any injuries that you sustain.
What broad form car insurance covers
The only coverage that is offered with broad form car insurance is liability, and the coverage amount is typically only enough to satisfy your state’s requirements. The liability coverage only extends to the driver who is listed on the policy.
Compared to other car insurance policies, broad form coverage is incredibly basic. Because of this, it can be an inexpensive car insurance option. In the United States, the average car insurance premium for a minimum coverage policy is $565 per year. If budget is your primary concern when it comes to auto insurance, broad form coverage might be an option for you. However, most insurance experts do recommend that you purchase higher liability levels if you can afford to do so, since they will provide you with more financial protection if you cause an accident.
What broad form car insurance does not cover
Auto insurance policies consist of several different coverages. There is liability coverage, which pays for the damages that you cause to other people in at-fault accidents. Broad form insurance only covers you for the state-required minimum amount of liability, but with other policy types you can typically choose from several different levels of liability coverage.
Broad form car insurance does not include any coverage for your medical expenses or for damages to your vehicle. Unlike other auto insurance policies, you will likely not have the option to add endorsements such as car rental coverage or emergency roadside assistance.
Broad form car insurance also does not cover any other driver to drive your vehicle. If you are the listed driver and you loan your vehicle to a friend, the liability coverage that you have purchased will likely not provide coverage if your friend causes an accident.
Advantages and disadvantages of broad form auto insurance
With any auto insurance option, there are often benefits as well as drawbacks. Being aware of the advantages and disadvantages of your policy type can help you to make more informed decisions when choosing auto insurance coverage.
Advantages of broad form auto insurance
Broad form insurance is not the right type of auto insurance coverage for everyone, but there are certain situations where it could be the best option. Some advantages of broad form coverage are:
- It is inexpensive: Broad form policies are often less expensive than other policies because there is very little coverage provided.
- It may be an option for high-risk drivers: If you have multiple incidents on your driving record, you might be considered a high-risk driver. Since you may pay significantly more for insurance and could run into eligibility restrictions with some insurance carriers, broad form insurance could be an option.
- It provides at least a minimum level of coverage: If your budget is particularly tight, broad form car insurance could be a solution. Even though the coverage is extremely limited, it can help you to satisfy your state’s insurance requirements and will provide at least some coverage in the event of an accident.
Most insurance experts recommend that you purchase higher liability limits, if possible. Talking to your insurance company may help you find discounts that could create room in your budget to purchase higher levels of liability coverage or even full coverage.
Disadvantages of broad form auto insurance
Because the coverage is so limited, most insurance experts do not recommend broad form car insurance coverage. Before purchasing broad form coverage, you may want to consider the following drawbacks:
- Lack of coverage: Broad form auto insurance does not offer coverage for anyone else to drive your car, for your own injuries, for injuries to passengers or for damages to your own vehicle.
- Limited availability: Because it does not provide much coverage, not all insurance companies offer broad form car insurance. If this is a policy type that you want to purchase, you may need to request quotes from numerous companies to find one that offers broad form coverage.
- Potential financial devastation: If you have broad form insurance and you cause an accident, you will be responsible for any expenses that exceed the limits of your policy. If the accident is severe, this could lead to financial devastation.
Auto insurance can often be customized to meet your individual needs. Although broad form car insurance is not the right choice for all drivers, there are scenarios where it could be a good option or perhaps even your only option. Doing your research and requesting quotes from multiple companies could help you to find the policy that is right for you.
Frequently asked questions
Will broad form coverage cover my passengers?
No, coverage will not typically extend to passengers. A broad form policy only provides liability coverage if the driver listed on the policy causes an accident, and only provides coverage for the damages they cause to the other party. To get coverage for injuries to your passengers, you will need to purchase medical payments coverage or personal injury protection (PIP) depending on the state you live in. It is also important to note that if someone other than the listed driver is using the insured vehicle and causes an accident, there will likely be no coverage at all.
Can I add certain coverages to my broad form policy?
Broad form insurance does not usually allow you to add optional coverages. However, there are car insurance options that allow you to purchase higher liability limits and coverages like comprehensive and collision. Finding a cheap auto insurance company and taking advantage of discounts can help to keep your premium lower so that you can afford to purchase these additional coverages.