“Many insurers authorize their agents to issue binders, which are documents that evidence the existence of insurance during the application process and before a policy is issued and delivered,” writes Matthew S. Marrone, Co-Chair of Goldberg Segalla’s professional liability practice focused on insurance agents and brokers. “Binders can be valuable tools, but they also present areas of E&O exposure for agents, brokers, and producers.”
In this article, Matt explores the importance of the distinction between an insurance agent and a broker when binders come into play, a number of potential ways in which binders can expose insurance professionals to serious errors and omissions claims, and the impact of state statutes recognizing temporary insurance binders.