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While you’re researching car insurance, a common term that might come up is an auto insurance binder. But what is an auto insurance binder, and do you need one?

In this guide, our review team answers this question and others related to the important insurance document. If you are interested in buying auto insurance or changing providers, you can use the tool below to collect and compare car insurance quotes from top providers. Or, you can call (844) 246-8209 for free, personalized quotes seven days a week.


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What Is An Auto Insurance Binder?

An auto insurance binder is a legal document issued by your insurance company that provides temporary proof of insurance coverage. The auto insurance binder letter allows you to drive legally while the insurance provider verifies your data and prepares your official car insurance policy document.

An auto insurance binder typically details some of the following things regarding your policy:

  • Vehicle details: Details your vehicle’s make, model, and vehicle identification number (VIN)
  • Liability, comprehensive, and collision insurance coverage limits: Indicates the type of coverage and policy limits that are being offered to the owner of the insurance policy
  • Name of policy owner and insurance company: Mentions the name of the insured individual and their insurance company
  • Deductible: Details the required deductible for claims
  • Insurance agent: Includes the contact information of the insurance agent who authorized the binder
  • Policy restrictions and exclusions: For example, whether your policy will be accepted in foreign countries

An insurance binder for a car typically expires after 30 to 90 days, so it’s important to make sure you’ve obtained your formal policy document before then. The official policy will usually arrive before the auto insurance binder expires, but it never hurts to call your insurance company and ask when you will receive your official document.

Once your car insurance binder expires, you are not technically covered with auto insurance until your formal policy document and insurance card has been issued.

When Do You Need An Auto Insurance Binder?

When you purchase an auto insurance policy, you should always request an insurance binder form to have evidence of insurance before a formal document is issued. It is handy to have an insurance binder on hand in case you are pulled over by the police or have an accident.

If you are financing your car, you will need an insurance binder to show your lender that you have obtained the amount of insurance required before the lender can approve your loan. Insurance binders are sometimes sent electronically through email or fax and sometimes mailed to your physical address. It is a smart idea to ask your car insurance company where it will be sending one to you before it comes.

Is A Future Policy Guaranteed Once I Receive My Insurance Binder?

Unfortunately, an official policy is not guaranteed once you receive your insurance binder. When you receive your insurance binder, your prospective auto insurance company is also examining several things about you. These include:

  • Your driving history
  • Your credit score
  • The type of vehicle you drive
  • How long you’ve been driving

After its examination, the company can choose to approve or deny further coverage for you. It may also choose to change your auto insurance rate.

What Should You Do When Your Insurance Binder Expires?

When your auto insurance binder reaches its expiration date, you should call your car insurance company to make sure that your formal policy has been issued. Upon expiration, you lose insurance coverage, so it is essential to know that your formal policy is on its way before your binder expires.

Our Recommended Car Insurance Providers

If you have not decided on a particular insurance company, we recommend Progressive and Geico, two of the best car insurance companies in the country.

Whenever you shop for car insurance, you should get quotes from multiple insurance agencies so you can compare coverage and rates. In addition to the insurance company you choose, factors such as your age, vehicle make and model, and driving history can affect your premium, so what’s best for your neighbor might not be best for you.

Use our tool below or call (844) 246-8209 to start comparing personalized car insurance quotes:


Progressive: 4.6 stars

With thousands of customer reviews and high ratings from AM Best, Progressive is one of the most reputable insurance providers in the United States.

Progressive sells standard coverages like comprehensive coverage, collision, and liability car insurance. In addition, you can get benefits such as roadside assistance, a usage-based insurance program, and rideshare coverage with your Progressive car insurance. For more, read our Progressive auto insurance review

Geico: 4.6 stars

Geico was named best overall in our industry review and is especially good for students and those seeking affordable insurance. Geico offers numerous discounts for car insurance, such as 25 percent off for multiple vehicles on a policy.

The insurer has an A+ BBB rating and an AM Best financial strength rating of A++. It owned over 13 percent of the 2019 auto insurance market share. With those high marks and a variety of discounts, Geico is a strong contender for most drivers. For more, read our Geico auto insurance review.

FAQ About Car Insurance Binders

What is an auto insurance binder for a car?

An insurance binder is a legal document that provides proof of temporary coverage. It can be useful to have before your actual policy document is prepared.

What will my insurance binder look like?

A car insurance binder is actually not a physical binder but a document. If it is mailed, it will come in some form of envelope and will look like a legal document.

Is a binder number the same as a policy number?

A binder number is a series of numbers used to identify you as an individual. It is not the same as your policy number. A policy number is not usually listed in an insurance binder.

Will my official insurance policy be exactly the same?

Since an insurance binder letter is provided while your official auto insurance policy undergoing the underwriting process, it is possible that there will be a change to your coverage or insurance rates. If the company determines that you don’t qualify for coverage, it will send a notice giving you about 30 days to find new coverage.

If the car insurance company labels you as high-risk, it may raise your rates. In that case, you would be billed the difference between what you’ve paid and what it’s determined that you owe.


In an effort to provide accurate and unbiased information to consumers, our expert review team collects data from dozens of auto insurance providers to formulate rankings of the best insurers. Companies receive a score in each of the following categories, as well as an overall weighted score out of 5.0 stars.

  • Industry Standing: Insurers with strong financial ratings and customer-first business practices receive the highest scores in this category.
  • Availability: We consider availability by state as well as exclusions for specific groups of drivers.
  • Coverage: This rating is based on types of insurance available, maximum coverage limits, and add-on policies.
  • Cost and Discounts: Our research team reviews sample quotes for a variety of drivers in every state. Companies with lower prices and many car insurance discount opportunities receive the best scores.
  • Customer Service: We comb through customer reviews and consumer feedback studies from experts like J.D. Power.
  • Technology: Auto insurers with mobile apps, advanced online services and telematics are more likely to meet consumer needs.

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