A. While acting within the scope of authority granted by the insurer, binders or other contracts for temporary insurance may be made by an agent orally or in writing, and shall be deemed to include all the usual terms of the policy as to which the binder was given together with such applicable endorsements as are designated in the binder, except as superseded by the clear and express terms of the binder.

B. No binder shall be valid beyond the issuance of the policy as to which given, or beyond ninety (90) days for written binders, fifteen days for oral, from its effective date, whichever period is the shorter.

C. If the policy has not been issued a binder may be extended or renewed beyond such ninety (90) or fifteen days with the written approval of the insurer.

D. This section shall not apply as to life or health insurances; and binders under the standard fire policy are governed by Section 492 of the Insurance Code and not by this section.

History: Laws 1984, ch. 127, § 351.

Compiler's notes. — Section 492 of the Insurance Code, referred to in Subsection D, was set out in Laws 1984, ch. 127, as reserved.

Binder is temporary contract of insurance which is intended to give temporary protection pending investigation of the risk and issuance of a formal written policy. Nance v. L.J. Dolloff Assocs., Inc., 2006-NMCA-012, 138 N.M. 851, 126 P.3d 1215.

But not written contract as basis for breach. — Because a binder is a contract of insurance and not a contract for insurance, even if there is a binder, and thus a written contract, it is not a written contract upon which can be based a claim for breach of contract. Nance v. L.J. Dolloff Assocs., Inc., 2006-NMCA-012, 138 N.M. 851, 126 P.3d 1215.