Travelers Insurance Cos. are exiting the Write-Your-Own market, selling the National Flood Insurance Program (NFIP) policies its companies write to American Bankers Insurance Company of Florida (ABIC).
ABIC is part of an Assurant Inc., unit that is based in Atlanta.
Write-Your-Own companies sell National Flood Insurance Program policies as part of their homeowners' insurance business, and also handle claims processing.
There are approximately 85 WYO companies.
Gary Griffin, a spokesman for Travelers, said, “This was a small, non-core part of our business and exiting the program eliminates the operational complexity associated with maintaining separate underwriting and claim processes required for participation.”
Griffin said Travelers is working with ABIC to ensure a smooth transition for policyholders and agents. We will continue to service and provide claim handling for policies issued through Travelers.”
He said Travelers is retaining the underlying homeowners' policies written by Travelers companies.
Travelers said it will stop writing new WYO business on Sept. 15, 2013, and it will stop offering WYO renewal policies on Sept. 1, 2013, for policies effective Oct. 15, 2013, and later.
The action is unlike the decision of State Farm to exit the WYO market in 2010 due to uncertainties related to the authorization of the NFIP.
At that time, State Farm turned over approximately 831,972 NFIP policies in stages back to the Federal Emergency Management Agency. They are now being administered through “NFIP-direct.”
A data processing company called CSC, based in Virginia, took over those policies. CSC was sold in August to National Flood Services, Inc. (NFS), based in Kalispell, Mont. NFS does most of the back-office work for 50 Write-Your-Own companies.
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