Texas General Lines — Property and CasualtyTexas Laws and RegulationsMedium
A Texas-licensed producer is preparing to bind coverage for a new commercial property policy. According to Texas regulations, what is the maximum duration for which a temporary binder can be issued without a policy being issued or delivered?
- A60 days
- B120 days
- C30 days
- D90 days
Show answer & explanationAnswer & explanation
Correct answer: D. 90 days
In Texas, a temporary binder for a property and casualty policy generally cannot exceed 90 days without the policy being issued or delivered. This ensures that temporary coverage does not extend indefinitely.
Why the other options are wrong
- A. 60 days is less than the maximum allowable period for a binder.
- B. 120 days exceeds the standard maximum duration for a binder in Texas.
- C. 30 days is too short for the maximum binder duration in Texas.
Texas Insurance Binder Duration
A temporary agreement providing coverage until a formal policy is issued, with specific time limits.
- Provides immediate, temporary coverage.
- Typically limited to 90 days in Texas.
- Can be extended only under specific, documented circumstances.
Memory trick: Ninety days is the binder's Texas limit, unless there's a special permit.