Motorcycle Insurance Articles
What A Binder Is On A Motorcycle Insurance Policy
2010-07-17
A binder is a vital part of any motorcycle insurance policy; or indeed, any kind of insurance policy referring to most forms of private transportation. An insurance binder is essentially a temporary form of proof of insurance that covers a driver with a new policy obtained prior to the policy being officially issued. In other words, the client who has taken out the insurance policy is still covered by the "binder" before the policy itself kicks into effect.
An insurance binder, be it in a motorcycle insurance policy or some other kind of insurance, will be issued under certain rules and regulations of the insurance company being dealt with. If you have just bought a motorcycle or other vehicle, or is changing insurance companies and is already intending to use it, then an insurance binder is obviously very important to cover the bike in case of an accident or other damages being done to the motorcycle before the new insurance policy officially begins. Thus the binder would need to include details such as the name of the person being insured, the type of insurance involved, clarification it's a motorcycle insurance policy, how much coverage (in terms of actual dollars and cents) is being given, and at what date the binder comes into effect. In most cases it would be immediately, since that is the purpose of the binder; however, not all insurance agents are actually able to write up an immediate policy, so in some cases the binder will not come into effect until one minute past midnight on the following day.
Most insurance companies can, however, issue a binder allowing you to at least drive the vehicle home.
Binders are often required for the purchaser of a motorcycle or another vehicle, even by the company originally selling the motorcycle. Many insurance companies do not allow you to drive the motorcycle off their property without such a policy already being in place. If the purchaser has taken out a loan in order to buy the motorcycle, the lien holder will also require a motorcycle insurance policy be taken out in order to protect their own investment on the purchase.
Most binders will protect your motorcycle for up to 30 days, which should be more than enough time for the main policy to have officially gone into effect. In regards to the full coverage, getting both comprehensive and collision insurance will ensure the bike is insured against all accidents, even if the fault is the client's own. An insurance binder is clearly an essential component of most motorcycle insurance policies.