A binder is valid for up to how many days from its effective date or until the policy issuance?

A binder serves as a temporary insurance contract that provides proof of coverage until the actual policy is issued. In South Dakota, the validity of a binder is typically established for up to 90 days from its effective date or until the policy is issued, whichever comes first. This duration allows the insured to have coverage in place while they wait for the formal policy documentation. The 90-day period is significant as it strikes a balance between providing immediate coverage and allowing the underwriting process or other administrative functions to conclude. Thus, understanding the 90-day limit is crucial for both customers and insurance professionals to ensure adequate protection during the interim period.