Glossary

Binder

Temporary written or oral evidence that coverage is in force on stated terms before the formal policy is issued.

Also called: insurance binder, binder of insurance, binding coverage, ACORD 75

A binder is a temporary contract of insurance. When an agent with binding authority or an underwriter issues one, coverage is in force from the stated effective date even though the policy has not yet been written. Binders can be oral but should be confirmed in writing, commonly on an ACORD 75 or in an email or letter from the agent or insurer. A lender at closing or a landlord at lease signing will often ask for one.

The binder names the coverages, limits, deductibles, premium and effective date, and it is subject to the terms of the policy form the insurer will issue. It lasts only until the policy is delivered, the binder expires, or the insurer cancels it with the notice the binder or state law requires. Many run 30 to 90 days, depending on the state and the carrier.

Treat a binder as proof of a promise, not of the whole policy. It is not a certificate of insurance, which only reports coverage already issued, and the premium is still owed. Compare the declarations page of the final policy against the binder as soon as it arrives, because differences in limits, forms or endorsements surface then, and a carrier that decides not to issue must cancel the binder properly. Ask the agent to confirm in writing what is bound, in particular any endorsements your contracts demand.

Last reviewed October 10, 2026

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Related terms

Certificate of insurance A one-page summary issued by an agent or insurer showing what coverage a business carried on the date issued, which confers no rights on the holder. Declarations page The front section of a policy that names the insured, policy period, covered locations or operations, limits, deductibles, premium and the forms attached. Underwriter The insurer's risk evaluator who decides whether to offer coverage, on what terms and at what price, within the authority the company grants. Endorsement A written amendment to an insurance policy that adds, removes or changes coverage, limits or conditions, and controls over the base form where they conflict. Named insured The person or entity identified as the insured in the policy's declarations, which holds the coverage and its duties; others qualify only if the policy says so.

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