Index | Property Insurance | Broad Coverage
The Homeowners policy types may have differences in details. The core benefits concerning the basic coverage types are reflected in all the policy types, but allow variations. So, the policies differ in the scope of coverage and in their functional assignment to different categories of citizens (landlords, tenants, condo dwellers, owners of older homes). Among them there are some policies designed for a wide spectrum of consumers. The policy for Broad Coverage is this type of a policy.
As the name suggests, Broad Coverage is more extensive than the coverage known as basic, or HO-1. On the whole, Broad Coverage reflects all the perils you are protected against under Basic Coverage (vehicles and glass breakage are all covered losses), but the number of perils is extended in comparison to the Basic Form and it includes building collapse, and damage brought to heating, air-conditioning, plumbing and sprinkler systems. Thus, the losses you will be reimbursed for with a Broad Coverage policy may result from the following reasons: sudden and accidental tearing, cracking, burning, or bulging of a steam or hot water heating system; accidental discharge from a plumbing, heating, air conditioning or sprinkler system or household appliance; freezing of a plumbing, heating, air conditioning or sprinkler system or a household appliance; sudden and accidental damage from artificially generated electricity; falling objects; weight of ice, snow, or sleet, and volcanic eruption.
In addition to all the risks covered by the Broad Form, there can be specific variations of this policy to meet your needs. For example, coverage can be extended to breakage of antiques, bathroom fixtures, or such a mishap as paint spillage. Then, there is a version of Broad Coverage specially designed for mobile homes.
Despite its advantages and the proclaimed broad coverage on the dwelling and its contents, Broad Coverage policy is noticeably limited in comparison with Special Form. It is inferior to HO-5, also known as Extensive Homeowners Policy, which renders the broadest coverage of all the Homeowners policies. The latter policy is quite an expensive and less affordable insurance product. It is a rare occurrence on the Homeowners market. That is why if you are considering purchasing Broad Coverage, you will most likely be choosing from Basic Coverage, Broad Coverage and Special Form, unless there are conditions requiring special treatment and a special policy (like, for example, "older-home" materials or architecture).
Among the disadvantages of Broad Coverage experts on Homeowners Insurance often point out the inadequacies of this policy in relation to coverage for personal belongings. In this aspect HO-2 is said to be rather limited and copy a Dwelling Fire Policy usually purchased by landlords and tenants.
In financial terms, the Broad Coverage policy premium usually costs about 5% to 10% more than a Basic Coverage policy.
If Broad Coverage is your choice, the chances are that you will at least consider adding optional coverage to your policy. Remember that an optional coverage will be offered to you at additional cost depending on the type you choose. It is advisable to consult an insurance agent and ask about the highest insurance limits for the coverage you choose as optional. The most frequently purchased supplements to HO-2 are an additional replacement cost policy (if your policy operates on the actual cash value basis), earthquake and flood policies which you might be interested in purchasing if you live in the zone prone to such disasters, physical damage coverage on recreational motor vehicles, loss assessment coverage and identity theft coverage. There are other supplements you can choose from, but to learn about them you are to conduct a thorough check of the available options.