What Is Broad Coverage Insurance?

Broad form homeowner's coverage includes damage from the weight of snow.
Broad form homeowner's coverage includes damage from the weight of snow. (Image: Comstock Images/Comstock/Getty Images)

"Broad form" coverage is a term that can apply to a variety of different insurance products. It refers to the coverage afforded by a given policy rather than a type of policy itself. It is most commonly used in commercial general liability and homeowners insurances, but can, in some cases, be used in auto insurance, as well.

General Definition

When something is broad, it connotes that there is something similar that is less broad. Indeed, broad coverage is named such because it offers coverage on a broader scale than basic coverage. Both are named peril policies, meaning they only cover losses from a specific list mentioned in the policy. The broad form policy, however, contains more covered perils than the basic form. This general principle applies to the various instances where broad form coverage is used.

Homeowners Insurance

The two simplest types of homeowners insurance are basic and broad form. Basic form homeowners insurance is not sold by many insurers, as of May 2011, since its restrictive set of only 11 covered perils did not meet most homeowners insurance needs. Broad form expands the list of covered perils to 17, adding such perils as broken glass, weight of ice and snow, falling objects and certain water damage to the existing basic list.

Commercial General Liability

Businesses face a variety of perils that may vary by industry, so they need a liability policy that offers standard protection with the ability to endorse certain other perils to the policy as needed. Therefore, many commercial general liability policies are written in broad form. They begin with a list of named perils that are common to many types of industry, then get endorsed to meet a specific business's needs.

Auto Insurance

In certain cases, broad form coverage can apply to auto insurance as well. An endorsement called "broad form drive other car" allows people with access to a company car to receive protection when they use the company vehicle for personal purposes. The commercial auto policy protects the company against liability incurred by the driver, but may not protect the driver directly unless the broad form coverage is applied. With this endorsement the driver is protected against liability lawsuits no matter when he uses the company car.

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