Broad form home insurance – what you need to know
Broad form home insurance generally protects your dwelling from all risks, and the personal belongings inside your home from named perils only— events specified in your policy
Like most things we buy, home insurance comes in all shapes and sizes, from minimum coverage in a no frills policy to very thorough protection offered by comprehensive home insurance. While we’d all like to be fully protected, managing our budget is important too and that’s where selecting the home insurance – broad option can be an option.
How does broad form home insurance measure up?
A broad form home insurance policy generally protects your dwelling from all types of loss, or all risks (except those that the policy specifically excludes), but restricts coverage on its contents (the personal belongings inside your home) to named perils only.
In Canada broad form home insurance is generally not a lot more expensive than comprehensive, where your belongings have the same protection as your residence, so it would usually make sense to choose a comprehensive policy. In some cases, you might choose broad home coverage if insurers won’t offer you comprehensive, either because of the type of property or risks, such as with as seasonals like cottages and park models, or dwellings with out of date electrical, such as knob and tube or mixed aluminum.
What’s not covered by broad form coverage?
1. Mysterious disappearance
The main exclusion from a named perils policy such as broad form contents coverage is mysterious disappearance (lost items). Mysterious disappearance most often involves jewelry: Heirlooms go missing with no evidence that they were stolen; diamonds fall out of rings; and bracelets and necklaces fall off. Each of these examples would not be covered under a named perils form but would be picked up by an all risks form, as it would with a comprehensive home insurance policy.
2. Onus of proof
Another difference between a named perils policy such as broad form vs. all risk is the onus of proof. Precedent in Ontario courts favours that in a named perils policy, the onus of proof is on the insured to provide evidence that the loss occurred due to a named peril. This is why thefts often have to be reported to police to apply coverage. In an all risks form, you would only have to prove that the damaged property belongs to you and that a policy was in force on the date of loss. Then coverage is implied. The onus is then on your insurer to prove an exclusion applies in order to deny coverage.
3. Other examples of broad form exclusions
Other examples of losses generally not covered by broad form property coverage include accidental damage; rips; stains; and power surges.