What provides temporary insurance coverage while awaiting approval from the insurance company?

The correct answer is that a binder provides temporary insurance coverage while awaiting approval from the insurance company. This instrument serves as a preliminary agreement indicating that the insurer has received the application and that the coverage is in effect for a specified period, often until the final decision on the application can be made. Binders typically contain key terms of coverage and can be utilized to reassure the insured that they have protection in place before the formal policy is issued.

In contrast, an endorsement is an amendment to an existing insurance policy, modifying its terms or adding coverage but is not applicable for temporary coverage while waiting for policy approval. A policy is the formal agreement that outlines the terms of insurance coverage once it is fully approved and issued, thus it does not serve the function of providing immediate coverage during the waiting period. Lastly, a contract is a broader legal term that refers to any agreement between parties, which may or may not pertain specifically to insurance, and would not specifically indicate temporary coverage status like a binder does.