ACORD reference/Policy servicing
ACORD 75
Insurance Binder
What the ACORD 75 is for
A binder is real coverage. Unlike a certificate, which reports a policy, the ACORD 75 is a temporary contract that puts coverage in force while the policy is being issued. It is used at closings, on new acquisitions, and any time coverage must attach before paper arrives.
The two things that make binders dangerous are that they expire, and that they are issued under a specific grant of binding authority. A binder issued outside the agency's authority, or one that quietly runs out, is a live errors-and-omissions exposure.
What it collects
Described in our own words, block by block. This is a summary of the information the form gathers, not a reproduction of the form itself.
- Company and producer
- The carrier whose authority the binder is issued under, and the agency issuing it.
- Binder effective and expiration
- The date and time coverage attaches, and the date the binder ends unless replaced by a policy.
- Named insured and property or operation
- Who is covered, and what location or operation the binder attaches to.
- Coverages, limits and deductibles
- The terms being bound, at the limits and deductibles agreed with the carrier.
- Special conditions and additional interests
- Subjectivities the carrier has imposed, and any mortgagee or loss payee to be recorded.
Check before it leaves the agency
The defects that cause trouble later are nearly always the same handful. Run these before the form goes out.
- The binder is within the agency's actual binding authority for that carrier, class and limit. Check the agreement, not your memory of it.
- The expiration date is diaried, and the policy is chased before it arrives. An expired binder with no policy behind it is uninsured.
- Every subjectivity the carrier imposed is recorded on the binder and communicated to the client, and each one is satisfied before expiry.
- The limits and deductibles bound are the ones the underwriter agreed, in writing.
- Mortgagees and loss payees are recorded on the binder if a lender is relying on it at a closing.
- When the policy issues, it is compared against the binder. A policy that differs from what was bound is the exact fact pattern of a failure-to-procure claim.
What the ACORD 75 does not do
- It does not last indefinitely. Coverage ends when the binder expires unless the policy has replaced it.
- It is not a certificate, and it should not be issued as a substitute for one.
Which edition?
ACORD revises its forms, and the edition date is printed in the bottom-left corner beside the form number. This page deliberately does not name an edition, because a hard-coded one goes stale and a stale edition on a reference page is worse than none. Produce the form from your own management system, which will give you the current version, and read the corner if a carrier or a contract has asked for a specific one.
At renewal
BindCheck reads a bound renewal against the prior policy and reports every form, limit, deductible and endorsement that changed, with each finding cited to the page it came from. That matters for this form because what you put on an ACORD is only correct for as long as the policy behind it is unchanged: a certificate, an evidence form or a schedule of interests prepared from last term's facts is a defect nobody sees until the party relying on it needs it.
Related forms
Confirm the policy behind the form still says what you think
Send the prior policy and the renewal and BindCheck returns every form, limit and endorsement that changed, in about a minute, each cited to its source page.
ACORD is a registered mark of ACORD. BindCheck is not affiliated with, endorsed by or a distributor of ACORD, and this page reproduces no part of ACORD's copyrighted form text. It is a plain-English description of what the form is for.