Mamdani Administration Unveils First-of-its-Kind Insurance Program to Reduce Operating Cost of Housing Across New York City

 

City-backed insurance program will reduce premiums for approximately 100,000 homes by 2030, specifically affordable and rent-stabilized housing  

New York City Mayor Zohran Kwame Mamdani today announced a first-of-its-kind insurance program that will reduce the cost of property and liability insurance for affordable housing and rent-stabilized housing, a key step in tackling New York City’s housing and affordability crisis. An interagency working group comprised of the New York City Economic Development Corporation (NYCEDC), Housing Development Corporation (NYCHDC), and Housing Preservation and Development (HPD) will manage the selection and partnership of the insurance program, which aims to issue new insurance policies for 20,000 homes next year and 100,000 homes by 2030. The program will be self-sustaining over time and will help the City subsidize more affordable housing and support housing and property owners with rising costs by addressing a major cost driver: the price of insurance has more than tripled since 2017.

As New York City faces an unprecedented housing crisis, the Mamdani administration is using every tool at its disposal to drive down the cost of housing. The skyrocketing cost of insurance has hit affordable and rent-stabilized housing particularly hard, and every $100 increase in insurance costs requires $1,200 more in City capital in new transactions – meaning the new proposal will also drive down City spending per home in its affordable housing programs. To address these rising costs, broaden the reach of the City’s affordable housing subsidy, and help building operators make repairs, the City will hire independent actuarial experts to design and launch a new insurance program that will begin offering coverage in 2027.

“We cannot take on the housing crisis without confronting one of the fastest-growing costs facing New Yorkers: insurance. That’s why we’re creating the first city-backed insurance program -- to help New Yorkers stay in their homes, give building owners the support they need to make repairs, and build a city that New Yorkers can actually afford,” said Mayor Mamdani.

“The skyrocketing cost of insurance is putting affordable, rent-stabilized housing at risk and risks setting back our efforts to build a more affordable city. This groundbreaking effort will use the City’s purchasing power to lower insurance premiums, helping our own investments in affordable housing go farther and reducing operating costs for owners of rent stabilized housing. This is just one step in how we’re working to bring down housing costs across the board,” said Leila Bozorg, Deputy Mayor for Housing and Planning.

“To make New York more affordable, we have to go after the structural costs driving up the price of housing. Insurance is one of those costs, and it has been rising far too fast for affordable and rent-stabilized housing to absorb. This new approach will help preserve homes, stretch scarce public resources, and protect the stability of neighborhoods across the city,” said Julie Su, Deputy Mayor for Economic Justice.

This announcement, made during an address to the housing policy group the Citizens Housing and Planning Council, begins the multi-step process to launch a City-backed insurance program:  

• This week, HDC will issue a Request for Proposals (RFP) for an actuary or risk consultant that will provide expertise to design the program. 
• This summer, NYCEDC will issue a Request for Expression of Interest (RFEI) to solicit proposals for how best to structure and operate this insurance program. 
• By 2027, the City expects to lower cost of insurance policies for the first 20,000 homes.  
• By 2030, new insurance policies are poised to be available to 100,000 homes. 

“Soaring insurance costs are putting affordable and rent-stabilized housing at risk—this is a market failure that has gone uncorrected for too long, and it falls to government to step in. When we can lower the cost of running a building, that savings flows through to tenants,” said HPD Commissioner Dina Levy. “This effort is exactly the kind of bold, innovative response New Yorkers need to have access to affordable housing.”

"By investing in a city-backed insurance program, we will be tackling the housing crisis from a new and creative angle,” said NYCEDC Interim President & CEO Jeanny Pak. “At NYCEDC, we are looking to use every tool in our toolbox to deliver affordable housing and are thrilled to partner with HPD and HDC to carry out this vision and make New York City more affordable.”

“Rising insurance premiums have placed increasing strains on the housing market nationwide,” said HDC President Eric Enderlin. “Today’s announcement represents an important step toward delivering an innovative solution that will help ease the burden of insurance costs and protect the long-term financial stability of the city’s affordable and rent-stabilized housing stock.”