Nationwide will start winding down its status this May as a “Write Your Own” carrier within FEMA’s National Flood Insurance Program. Assurant said it formed an agreement with the insurer to fill the gap.
Plans call for Nationwide to begin transitioning out of the NFIP on May 16; the decision amounts to a revised strategy, Natonwide spokesman Eric Hardgrove explained to Carrier Management via email.
“Nationwide has made this strategic decision to focus on its core products,” Hardgrove said. “We are making this announcement now to give impacted agents/customers time to fully understand this change”
Financial details were not disclosed. But Assurant said it will acquire the opportunity to renew about 250,000 affected policies reflecting approximately $230 million in written premium within the National Flood Insurance Program.
Launched in 1983, the Write Your Own program is designed to allow participating property/casualty insurance companies to write and serve the Standard Flood Insurance Policy issued for the NFIP in their own names. The Federal Emergency Management Agency explains that participating companies get an expense allowance for policies written and claims processed. In turn, the federal government keeps responsibility for underwriting losses.
Assurant, a property insurer and provider of lifestyle specialty protection products, said it already the second largest NFIP flood insurance provider nationally. Gene Mergelmeyer, president and CEO of Assurance Specialty Property, noted that the transaction will “continue to build on our leadership position in the flood insurance market.”
“We will work with Nationwide to ensure a seamless transition for policyholders and agents, and look forward to providing them with excellent service,” Mergelmeyer said in prepared remarks.
As part of the deal structure, there will not be any changes to existing Nationwide NFIP benefits or policies, which will stay in effect through their renewal date. When renewal takes place, existing NFIP policyholders get the option to renew through Assurant. Also, Nationwide agents can now regularly offer NFIP policies through Assurant.
Last June, Assurant decided it would leave the health insurance market to focus more on its housing and lifestyle specialty protection business.