For how long is a binder valid from the effective date?

A binder, in insurance terminology, serves as a temporary agreement that provides coverage until a formal policy is issued. In Georgia, a binder is typically valid for 90 days from its effective date. This timeframe is critical as it allows the insured to have coverage while the insurer finalizes the underwriting process and issues the official policy.

Understanding the duration of a binder is important for both agents and policyholders to ensure continuous coverage and to manage expectations regarding when comprehensive policy documents will be delivered. This 90-day period is set to accommodate scenarios where more time may be needed for risk assessment, underwriting, or other administrative processes. Consequently, knowing the correct validity period helps agents advise clients appropriately and maintain compliance with state regulations.