What is broad form insurance?

With the word “broad” in its name, broad form insurance gives the impression that it offers extensive or broad coverage. In reality, it is quite the opposite.

So, what is a broad form car insurance policy?

Broad form auto insurance is also called broad form named operator coverage. It's minimal auto liability insurance policy for one named driver. This means very limited coverage for one person and one person only, driving a personal vehicle or vehicles. In fact, the coverage is so limited it does not meet the auto insurance requirements of most states and is currently only available in 11 states: Colorado, Delaware, Idaho, Iowa, Maryland, Mississippi, Nebraska, Nevada, Ohio, Tennessee, and Washington.

This type of limited liability broad form coverage means if you are in a car accident with another vehicle, your policy will only cover the other vehicle and the injuries sustained by the other driver.

What does broad form auto insurance cover?

Broad form insurance covers only injuries and property damage to others, and only when they are caused by the driver named in the policy.

It is safe to say that there are more things broad form insurance does not cover, than things it does. It is important to be aware of the gaps in coverage should you go with a broad form policy.

Here are some things broad form coverage does not include that most standard auto insurance policies do include:

  • Comprehensive: Non-collision damages to your car that are caused by events that are out of your control. Some examples are theft, vandalism, fire, acts of nature, and weather.
  • Collision: Collision damages to your car like an accident with another vehicle or object, like a tree.
  • Others driving your vehicle: Since broad form auto insurance is for one named driver only, the liability coverage will not apply when others are driving your vehicle.
  • Your own personal injuries: Though you can purchase additional personal injury protection in addition to a broad form policy, your own personal injuries will not be covered with broad form auto insurance.
  • Uninsured or underinsured motorist: If you are in an accident with an uninsured or underinsured driver, this coverage provides protection.

Who should get broad form insurance?

The reality is, with state limitations and gaping holes in coverage, there are few people for whom broad form insurance is sufficient. If you fall into these categories, broad form coverage may be a low-cost option to consider. However, it is important to remember that there is still a significant risk of financial loss with broad form coverage.

  • You are a driver seeking minimal liability coverage with the financial resources to pay out of pocket for other losses.
  • You do not own a vehicle and only occasionally drive other’s vehicles, or your vehicle has a very low value.
  • You never drive with passengers in the vehicle.
  • You are covered under a standard insurance policy but are seeking some additional coverage.

Even in the situations above, it's best to consider other options before selecting broad form insurance. Non-owner car insurance, for example is better for people who don't own a vehicle but do drive other people's cars.

What does broad form insurance cost?

If you compare the cost of a broad form policy with that of a full coverage policy, you will find broad form auto insurance is a lot cheaper.

But that's because broad form insurance covers much less.

To illustrate, here is a table to compare costs, by state, of minimum required liability and full coverage. Note that this includes the 11 states where broad form insurance is available, but standard minimum liability rates are shown. At the time of this reporting, five insurers we contacted to get broad form insurance rate estimates had not responded.

State Full coverage State minimum Difference
New York$2,062$867$1,195
Rhode Island$2,040$738$1,302
New Jersey$1,993$846$1,147
West Virginia$1,654$541$1,113
South Carolina$1,653$617$1,036
South Dakota$1,643$323$1,320
New Mexico$1,604$479$1,125
North Dakota$1,577$423$1,154
North Carolina$1,425$438$987
New Hampshire$1,086$424$662

How to get broad form insurance

If you live in a state that offers broad form auto insurance and have decided it is a good option for you, start by reaching out to at least three insurance providers for quotes. Many providers offer online quoting tools on their website, but since you are looking for a very specific type of coverage, it may be a better option to call and speak with an authorized agent to request a quote.

Once you have received quotes from various providers, compare both the premium and deductibles you’ve been quoted.

Next, visit sites like A.M. Best,JD Power and Associates, and National Association of Insurance Commissioners to research the company’s financial strength, reputation, and consumer complaints. By assessing all of these factors, you will find which insurance company will provide you the best value.

After you decide which insurance company to go with, they’ll work with you to finalize the policy.

Broad form auto insurance: The bottom line

Car insurance, like any insurance, can be expensive. It may be tempting to switch to broad form insurance to reduce costs. However, we recommend looking for other solutions first. There are some great ways to save money on your car insurance without sacrificing coverage.

  • Get competitive quotes from other companies to make sure you’re getting the best value.
  • Use tools like our car insurance coverage calculator to avoid paying for more than you need.
  • Speak with your insurance agent about discounts.
  • Speak with your insurance agent about bundling options.
  • Keep a clean driving record.

It's important to have adequate auto insurance coverage to avoid leaving yourself and others at risk of major financial loss. Broad form insurance doesn't provide adequate coverage for most people.