You should request your insurance binder after you complete the home purchase agreement. Your insurer issues a binder at the beginning of your policy coverage after you pay your first premium. Most insurance companies use a standard template by the Association for Cooperative Operations Research and Development (ACORD), a nonprofit group that establishes standards for insurance agencies.
It’s an assurance you have proper home insurance for the lender and will have a policy when you close on your home. The insurance binder establishes proof of a pending home insurance policy. The underwriting process for a home insurance policy can take time, so insurance companies issue an insurance binder as proof of a pending policy. It’s a legal document and proof of insurance coverage for your intended home. Your insurance binder is proof of a pending policyĪn insurance binder is, contrary to its name, not a three-ring binder. Below we break down what one is, how to get one, and what they contain. Lenders need home insurance before they can approve your loan request, and as you wait for an official insurance policy, your insurer may provide you with an insurance binder.Ī binder is temporary proof of coverage for your lender while your full policy is in process.
The home-buying process requires mountains of paperwork, especially with a mortgage.
