Binder

Binder, also known as an insurance binder, is an agreement between the policyholder and the insurance carrier that serves as temporary proof of insurance for the insurance policy. This is normally issued when the insured needs to show proof of coverage. This document, however, will be dissolved once the formal policy is issued.

A binder is issued by the insurance company or an insurance agent on the company’s behalf. It differs from an insurance certificate in that a binder provides coverage and acts as actual insurance whereas the certificate is a mere summary of the coverage.

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