Which type of insurer generates approximately 90% of NFIP policies?

The correct answer is that Write Your Own (WYO) private insurers generate approximately 90% of National Flood Insurance Program (NFIP) policies. WYO programs allow private insurers to write and service federal flood insurance policies in their own name, making them responsible for underwriting and certain administrative functions while the federal government retains the risk of loss. This partnership is beneficial as it leverages the existing infrastructure and customer service capabilities of private insurers, enabling more effective distribution and management of flood insurance products.

WYO insurers play a crucial role in expanding access to flood insurance, as they can market policies to their customers and integrate flood insurance into their existing offerings. This approach has significantly increased the penetration of flood insurance in areas that are prone to flooding, aligning with the goals of the NFIP.

The other options do not contribute significantly to the issuance of NFIP policies. For instance, the federal government is the overarching authority that oversees the NFIP but does not directly issue the majority of policies. State government insurers primarily focus on other types of insurance and generally do not handle flood insurance under the NFIP. Similarly, mutual insurance companies, which are owned by their policyholders, do not dominate the NFIP market as their focus might be more towards property and casualty insurance