What happens during the 'Bind and Issue' step?

During the 'Bind and Issue' step, the coverage becomes legally binding. This phase is crucial in the insurance process as it signifies that both the insurer and the insured have agreed to the terms of the policy, establishing a legally enforceable contract. Once the binding occurs, the policyholder gains coverage, meaning that they are protected against the risks specified in the policy, and the insurer is committed to fulfilling its obligations under that policy.

In this step, crucial documentation may be prepared, and it is officially acknowledged that the policy is in effect. This is the point at which a policyholder can confidently rely on their coverage until the policy is either completed or terminated according to the terms laid out.

While the payment plan might certainly be discussed and finalized in proximity to this step, it does not constitute the binding of the coverage itself. Similarly, underwriting decisions have been previously made before this step, and while documents might be issued, the essence of this step lies primarily in the establishment of a binding agreement. Consequently, the core function of the 'Bind and Issue' step revolves around making the coverage legally binding.