What is an insurance binder?

An insurance binder is a temporary document provided by your insurance company when you purchase a new policy. It acts as a placeholder for your formal insurance policy, which might take days or weeks to issue due to the underwriting process. This binder includes essential details like coverage amount, effective date, and names of insured parties, and it serves as proof of insurance for lenders or others needing confirmation of coverage. A binder offers necessary interim coverage until your actual insurance policy is finalized.