A binder is temporary evidence that coverage has been agreed, issued before the policy is available, and it expires. The policy is the actual contract of insurance and governs. A certificate is a summary issued to a third party, conferring no rights and creating no coverage. The three documents describe the same arrangement and can, in practice, disagree with one another.
Updated September 2026.
Why brokers care
Checking the issued policy against the binder is where most policy checking finds its errors: a limit that moved, a deductible that changed, a classification that shifted between what was bound and what was issued. If nobody compares them, the client is holding a policy that differs from what they agreed to buy, and the certificate describes whichever document was to hand when it was produced.
What to check
- That the issued policy matches the binder on limits, deductibles and forms
- Whether the binder has expired and the policy has actually been issued
- That the certificate reflects the issued policy rather than the binder
- Any endorsement present in one document and missing from another
- Effective dates across all three, which frequently diverge
Common mistake
Never comparing the issued policy to the binder. This is where policy checking finds most of its errors, and if nobody runs the comparison the client holds something different from what they agreed to buy.
Comparing the three is covered in the certificate software guide.