Broad Form Insurance: What Is It and Why Should You Buy It?

It’s no secret that car insurance is among the most important things that you need to buy as a responsible car owner. However, because there are so many cars on the road with different types of capabilities and roles, there are many different types of insurance policies. While having this range of options is great for the informed customer, for the uninformed customer, choosing the best type of insurance can be a little scary. Not only would the insurance policy that you choose affect your insurance rates and the cars that you can drive, but it will also limit what kind of driving privileges you have in general. One of the most overlooked types of insurance that many different insurance companies offer is broad form insurance. If you are not familiar with this type of insurance, you need to read on. We have covered what broad form insurance is and why you should buy it below.

What Is Broad Form Insurance?

In its simplest terms, broad form insurance is a basic type of liability insurance that lets you fulfill your state’s liability requirements while still allowing the price to come in at a lower cost to you. In most cases, the one downside to this type of insurance policy is that only the driver named on the liability policy is covered under the policy itself. As such, someone who is in a big family and may need to lend their car out to many other people would not benefit from this form of insurance, as it only will cover the driver who originally took the insurance policy out. It is important to know that broad form insurance is not available for every driver and is currently only authorized in a few states. Because of this, we suggest that you check with your state liability requirements to be sure that a broad form insurance policy is a valid type of insurance for you.

What Does Broad Form Insurance Cover?

As stated previously, broad form insurance covers only the person who took out the broad form insurance policy. As such, this policy will exclude any other driver from operating your vehicle with the same type of coverage. Besides this, broad form coverage will only carry the minimum amount of insurance necessary to be able to drive on the road. However, for most drivers this amount of coverage is enough, as they will only ever need it to repair other damages caused to the other vehicle.

Why Would Someone Need To Buy Broad Form Insurance?

While it may seem like a niche type of insurance, broad form insurance is actually applicable in many different areas and situations. Besides being a cheaper form of car insurance, if you own multiple cars, you will not have to pay additional insurance for each car with broad form insurance. Just remember that every car that you register under this type of insurance cannot be driven by anyone else. However, in general, if you are a single buyer, a broad form insurance policy will be beneficial to you because it will allow you to get the same benefits as you would normally get, but at a lesser cost. Another reason why someone may want to buy broad form insurance is if they have a low-value car. In most cases, having a high-value car involves paying a higher rate. Because of this, many people choose to drive low-value vehicles to avoid a higher insurance rate. Even so, many people do not go the route of using broad form insurance coverage, even though broad form insurance would provide them a lower rate and the same benefits.

What Is the Cost of Broad Form Insurance?

While we don’t have an exact number, many drivers report that they did save an average of over $1,000 per year using broad form insurance. This is because regular insurance policies will cover many different drivers on the insurance policy while providing a higher standard of coverage. However, if you drive a lower value vehicle or drive multiple vehicles, having a bare bones coverage option that only covers you may be the best option. It comes with a lower rate altogether. Even so, it is important to keep in mind that car insurance rates will always vary from state to state, meaning that one insurance policy average may not be the same for everyone else. As such, it’s up to you to find out what the best rates are for the area. You can easily do this by reaching out to a few of your local insurance companies to find out what they charge.

How Do I Know if a Broad Form Coverage Insurance Policy Is Right for Me?

In most cases, you’ll know if broad form insurance coverage is right for you if you have a low value vehicle or you are the only person driving your car. Besides this, if you are interested in saving money on your car insurance while still gaining the same amount of coverage, you definitely should be interested in broad form insurance. Just remember to discuss this with your auto insurance provider to ensure that you understand all the benefits and drawbacks that this type of coverage can provide. After all, every insurance company offers slightly different types of broad form insurance policies, which means that not every policy may cover the same amount or follow the same general guidelines that others do. By asking your insurance company about the broad form auto insurance policy, you will be able to gain a perfectly clear picture of the benefits and drawbacks that your specific insurance company may provide.

We hope you have found our article covering what broad form insurance is and why you should buy it to be helpful. We’ve given you a general idea of the benefits of this insurance, but the choice is up to you. If you yourself are looking to purchase a broad form auto insurance policy, be sure to reach out to Serenity Group today. We are dedicated to giving you the best rates possible while still providing the best customer service as well. Because of these factors, we think that you will enjoy your time with us and the services that we can provide.