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Is Broad Form Insurance Available and Legal in Your State?Before purchasing broad form auto insurance, it is important to know about the insurance requirements in your state, which can affect your ability to carry this type of coverage. Here are some reasons why you may or may not be able to use this insurance:
- It may not satisfy all of the legal, minimum requirements for the state you live in.
- It is not available in every state.
- States that currently allow broad form insurance are reviewing the specifics of the policies to determine if they are legally allowable or not.
Other Reasons Why Broad Form Insurance May Not Work for You
In addition to not meeting minimum insurance requirements in some states, broad form insurance has a number of other factors that may make it less than ideal for your needs:
- Should not be used if there is more than one legal, licensed driver in the house
- Should not be used by someone who frequently allows other drivers to borrow their vehicle
- Should not be used as a primary coverage on an expensive car
- Should not be used by a high risk driver
Why Broad Form Insurance Can Be Appealing in Some Cases
Not to be mistaken for another insurance type with a similar name, broad form insurance can have some appeal in a number of situations including:
- Very inexpensive (typically), limited liability insurance
- Restricts insurance coverage to only the named operator on the policy
- Additional insurance coverage can be added to this policy, with some restrictions
- Perfect for cars that are paid off and of lower value
- Restricts the events that are covered
Beyond the Basics of Broad Form Insurance
In addition to the lower cost broad form insurance, there is comprehensive broad form insurance, which is different from liability broad form in a number of ways.
- This type of broad form insurance tends to be very expensive in comparison to other types of coverage.
- It offers more coverage for more events than limited liability broad form insurance.
Both types provide coverage for the stated driver in any car that he or she is legally driving, no matter who the owner might be. However, if there is an accident or loss, the owner’s insurance will cover the costs and the broad form insurance will become a secondary coverage only if it is needed.
Warnings if You Use Broad Form Insurance
If you plan to pursue broad form insurance (provided that it is offered in your state), there are some things to keep in mind:
- Comprehensive broad form insurance, in addition to being very expensive, carries a deductible.
- If you do allow someone to drive your car at any point and there is an accident, you can be sued.