What Is Broad Form Insurance Coverage?

Broad form car insurance is a cheaper option that only covers one driver with minimum liability coverage. This means anyone else who drives your car is not covered. Because of the risk level, this type of policy is only available in a few states.

This guide will help you better understand broad form insurance to determine if it's the best option for you.

What is broad form insurance?

While the term "broad form" may sound like a wide range of coverage, it's actually the opposite.

Broad form insurance, often called broad form named operator insurance, is a type of basic coverage that can fulfill your state's minimum liability requirements for auto insurance.

Only the driver's liability costs are covered under this policy. Broad form may appeal to people who want to pay as little for car insurance as possible and only need to cover themselves and no family members.

However, broad form insurance may not be available for every driver looking for cheap coverage. It's currently only authorized in a few states, such as Delaware and Washington. Conditions apply when it comes to what's covered under broad form insurance.

What does broad form auto insurance cover?

Broad form insurance is inexpensive liability coverage, which insures you as the driver. But broad form has one important distinction from standard auto insurance policies. Unlike most liability coverage, which allows you to add multiple drivers on one policy, broad form will only cover one licensed driver on the policy.

This will not cover anyone driving your vehicle but you. Because of this, broad form coverage is best for drivers who don't allow anyone to drive their car.

If you own or drive multiple cars, you don't have to pay for additional vehicles under your broad form policy. But if you don't own a car, nonowner car insurance is a better fit. Since you need liability coverage in most states, a broad form insurance policy can be an inexpensive option, especially for single-car owners.

Should you get broad form insurance?

To decide if broad form insurance is right for you, some factors to consider include:

Broad form coverage is recommended for people who are looking for cheap insurance, own a low-value car or drive other vehicles that they do not own.

Benefits of choosing broad form coverage

In effect, broad form is the same as liability-only coverage, but only one driver can be on the policy. Because of this, you can save considerable money on your monthly premium. Unlike with standard liability coverage, you cannot add family members to your policy.

If no one else is going to be driving your car, you won't need insurance for additional drivers. Covering other drivers and passengers can get pricey, so broad form insurance might be a good cheap solution.

Though it is not available in every state, this coverage can help you meet the minimum liability requirements to drive legally in the states that do offer it.

How much cheaper is broad form insurance than a standard policy?

Drivers who choose broad form insurance over full coverage could save an average of $1,500 per year. Unlike broad form policies, full coverage includes comprehensive and collision coverage and higher liability limits. There is a level of risk with broad form coverage, as the company is only responsible for the driver on the policy.

Below, the cost of minimum liability insurance for one driver and vehicle is listed as a substitute for broad form insurance, because rates are similar. But broad form policies may be even cheaper than minimum liability policies.

Costs of minimum liability vs. full coverage from major companies

These insurance quotes are based on one driver, so, in this case, minimum liability coverage is used instead of broad form insurance. The quotes are for a 30-year-old man who drives a 2015 Honda Civic EX. State Farm offers the cheapest minimum coverage, at $712 per year, while Geico charges about $100 more annually for the same coverage.

Drawbacks of broad form insurance

Broad form insurance may be a cheap alternative, but it will not allow you to add or purchase comprehensive or collision coverage.

So if you are at fault for an accident, damage to your vehicle or passengers will be your sole responsibility, not the company's. If your car is totaled, you won't receive any payment from your insurance company.

However, broad form insurance does allow drivers to buy personal injury protection (PIP) and uninsured motorist coverage, which can cover certain medical expenses if you're in an accident.

If you do not own a car and frequently drive someone else's vehicle, broad form coverage will be considered secondary insurance. In other words, if the car's owner has coverage, claims will be made on their primary insurance before your broad form auto insurance kicks in.

Broad form insurance does not cover you for company-owned vehicles, motorcycles or RVs, but some states offer policies specifically for motorcycles. Broad form car insurance isn't the best option for everyone, especially if you own a newer vehicle or consistently drive with family or other passengers.

Is broad form coverage worth it?

Broad form auto insurance is the most bare-bones coverage option for car owners and drivers. Broad form coverage is best for drivers who:

If you need to put multiple family members on your policy or own a newer vehicle, you may want to consider other types of coverage. Ultimately, the choice of how much money you want to spend on protection is yours. Consider your financial situation and whether you have enough savings to cover damage to your vehicle if you're at fault for an accident.

Methodology

Rates were collected for a 30-year-old man driving a 2015 Honda Civic EX with no available credit history. This is equivalent to a driver with fair to poor credit, based on data from Quadrant Information Services. All car insurance quotes were evaluated from all available ZIP codes within each state.

The full coverage policy used limits slightly above any particular state's minimum requirements.

Full coverage policy

Please note that broad form insurance quotes were not readily available. So minimum coverage quotes for one driver were used instead. The car insurance rates for minimum coverage policies represent the average cost of a policy that meets state minimum requirements for auto coverage. Broad form insurance is only offered in select states.

This analysis used insurance rate data from Quadrant Information Services. These rates were publicly sourced from insurance company filings and should be used for comparative purposes only. Your own quotes may be different.