What should an insurance binder include for a mortgage?

Named insured, property address, carrier, dwelling coverage on a replacement-cost basis, deductible, an effective date on or before closing, and the lender named as mortgagee under a standard mortgagee clause with the loan number. Fannie Mae Selling Guide B7-3-07 (08/05/2026) wants evidence of a valid policy, or a certificate signed by the insurer.

This is for the processor or processing manager at an independent mortgage bank on Encompass whose HOI row is still open prior to docs. The counterparty is the insurance agency. Pull the conditions list, the loan number, the lender’s legal name, and the property address before you email the agent.

A binder is temporary evidence of a policy

Desks say “binder.” Fannie Mae Selling Guide B7-3-07 (08/05/2026) says verify a valid policy. A certificate of property insurance is acceptable if it has the information the lender needs and is signed by the insurer. If the lender cannot tell whether the policy meets the Guide, the loan is not eligible for Fannie Mae purchase.

Document	What it is	What the underwriter can do with it
Binder	Temporary insurance contract pending the policy	Clear HOI if the fields below are on it
Declarations page	Summary of an issued policy	Same, and it is already the policy
Certificate of property insurance	Short-form evidence	Acceptable under B7-3-07 if signed by the insurer
Quote or proposal	Not a contract	Bounce. Coverage is not bound

The usual form the agency sends is an ACORD 75 Insurance Binder (2016/03 edition, read 2026-10-09). It prints that it is a temporary insurance contract, then blocks for the insured, the carrier, the binder number, dates and times, the property, coverages, additional interest, and a signature. Fannie’s single-family Guide does not name ACORD 75. It names a valid policy or an insurer-signed certificate. Take either form if the fields below are filled.

What a mortgage lender needs from the homeowners insurance agent before closing is the rest of the packet. This page is the fields on the binder itself.

What to put on the binder

Ask the agency for a bound document, not a quote. Washington WAC 284-30-560 (read 2026-10-09) is one state’s producer rule: a written binder must be dated, identify the insurer, briefly describe the coverage, state the date and time coverage is effective, and acknowledge any premium received. Other states differ. Check counsel. This is not legal advice.

Field	Why it is on the binder
Named insured: every person who holds title	B7-3-08 (12/14/2022)
Property address, matching the file	Wrong street, or a missing unit number, is a bounce
Carrier legal name	The contract is with the insurer, not the agency
Binder number, or a policy number if one exists	Identifies the contract. A blank policy number is normal on a new purchase
Effective date and time on or before closing	Coverage has to exist when the loan funds. ACORD 75 prints 12:01 a.m. as the usual time
Expiration date of the binder	Temporary. See the ninety-day caps below
Dwelling coverage on a replacement-cost basis (roofs may be actual cash value)	B7-3-02 (08/05/2026)
Deductible at or under 5% of the coverage amount, including any separate peril deductible	B7-3-02
Mortgagee checkbox, not only loss payee	B7-3-08. A loss payable clause is not acceptable
Lender or servicer legal name, then “its successors and/or assigns” (ISAOA), mailing address	B7-3-08
Loan number	Shop overlay so the endorsement hits the right file
Authorized representative signature	B7-3-07 wants the insurer’s signature on a certificate. An unsigned PDF is the usual bounce

On r/InsuranceAgent in July 2025, producers treated a binder as temporary evidence that coverage is bound, usually 30 to 60 days or until the policy is delivered, and treated evidence of insurance as a different ACORD form. Ask for a binder or a dec page with the mortgagee line filled.

The mortgagee line is the usual bounce

B7-3-08 requires a “standard” or “union” mortgagee clause without contribution on a one- to four-unit policy. A loss payable clause is not acceptable. Name the lender, then “its successors and/or assigns,” then the mailing address. If the lender is not the servicer, name the servicer that way. Do not name Fannie Mae unless coverage would be impaired without it, and then only as “Fannie Mae, in care of” the servicer. MERS must not be named as mortgagee or loss payee. Freddie Mac Guide 4703.6 (read 2026-10-09) is the same on MERS.

ACORD 75 has three additional-interest checkboxes: mortgagee, loss payee, additional insured. Checking loss payee and typing the lender’s name still fails B7-3-08. Check mortgagee. A refinance still needs this lender’s clause. A prior servicer in the mortgagee field is a bounce.

On r/InsuranceAgent in June 2025, agencies said a complete binder request takes minutes and a last-minute close-date change does not. Send the legal name, ISAOA, mailing address, loan number, and closing date in the first email.

Coverage on the binder is settlement language

B7-3-02 (08/05/2026) treats a one- to four-unit policy as sufficient when it settles on a replacement-cost basis, except roofs. Roofs must be insured; they do not have to be replacement cost. The maximum deductible is 5% of the coverage amount, and each separate peril deductible has to stay inside that 5%.

The Guide no longer uses unpaid principal balance versus 80% of replacement cost on a one- to four-unit file. Many desks still match dwelling coverage to the loan amount. That match is a shop overlay. Read the settlement language on the binder before you chase a dollar figure. If the form is silent on replacement cost, ask the agent for a line that the policy settles on a replacement-cost basis up to the limit shown. That is not a replacement-cost estimate.

HUD Handbook 4000.1 (read 2026-10-09) puts Evidence of Hazard Insurance in the FHA case binder. It does not publish a UPB formula for a one- to four-unit origination file.

What to leave off

Item	Why it delays or fails
Quote or proposal	Not bound
Certificate signed only by the agent	B7-3-07: signed by the insurer
Loss-payee checkbox instead of mortgagee	B7-3-08
MERS as mortgagee or loss payee	B7-3-08 and Freddie 4703.6
Fannie Mae or Freddie Mac named as mortgagee	Name the lender or servicer
Effective date after closing	The file cannot fund
Prior lender on a refinance	This lender’s clause
Full Social Security number	Last-four if a portal asks
A binder that already expired	Coverage is not in force
Agent letter guaranteeing 100% replacement cost	Overlay, and an E&O problem for the agency

Oregon ORS 746.195 (read 2026-10-09) says a depository institution may not refuse a written binder issued by an insurance producer as proof that temporary insurance exists on the collateral, unless federal or state law prohibits it. Independent mortgage banks are not automatically depository institutions. Other states differ. Check counsel. This is not legal advice.

The binder itself expires

A binder dies when the policy issues, or on the expiration printed on it, whichever comes first. Washington RCW 48.18.230 (read 2026-10-09) says no binder is valid beyond policy issuance or ninety days from its effective date, whichever is shorter, unless the commissioner approves an extension. Oregon ORS 742.043 (read 2026-10-09) requires a policy in lieu of the binder within ninety days unless the director approves an extension.

If closing slips past the binder’s expiration, ask the agency for a new binder or the issued dec page. Do not fund on an expired temporary contract. If the policy renews within about two months of closing, many shops ask for the next term. That window is a shop overlay, not a Fannie rule.

A condo file needs more than the unit binder

A unit HO-6 binder is not the master. B7-3-07 requires the current master policy, or a certificate showing the unit is covered. Put the standard mortgagee clause on the HO-6. The master names the HOA.

Pull the files that still have an open HOI condition. Check each binder against the conditions list: named insured, property address, carrier, replacement-cost dwelling, deductible, effective date on or before closing, and the lender named as mortgagee with ISAOA and the loan number. Resend the same ask for any missing field, and log the sent date on the file that afternoon.