Use of Binders

PURPOSE: This regulation prohibits insurance producers from binding insurance to provide rate advantages. This regulation was adopted pursuant to the provisions of section 374.045, RSMo and implements sections 379.318 and 379.470, RSMo. (1) Policy Coverage Concurrent. Any policy of property and casualty insurance replacing a binder must provide coverage from the date of coverage under the binder. (2) Rate Advantage Prohibited. The use of binders written to cover property or casualty risks may not result in a rate advantage to any party. (3) Binder Premium Charge Required. If a binder is not replaced by an insurance policy, a binder premium charge must be made which does not exceed the pro rata amount of premium which would have been applicable for that coverage had the policy been issued. (4) The requirement as stated in section (3) of this regulation is not applicable if the binder premium charge is twenty dollars ($20) or less. A binder premium charge of twenty dollars ($20) or less may be made at the option of the insurer. AUTHORITY: sections 374.045, 379.318 and 379.470, RSMo 2000.* This rule was previously filed as 4 CSR 190-16.030. This version of rule filed July 27, 1964, effective Aug. 7, 1964. Amended: Filed Dec. 5, 1969, effective Dec. 15, 1969. Amended: Filed Dec. 20, 1974, effective Dec. 30, 1974. Amended: Filed Jan. 28, 1975, effective Feb. 20, 1975. Amended: Filed Jan. 9, 1990, effective May 1, 1990. Amended: Filed July 12, 2002, effective Jan. 30, 2003. *Original authority: 374.045, RSMo 1967, amended 1993, 1995; 379.318, RSMo 1972; and 379.470, RSMo 1947.