May 21, 2021

Rising Insurance Premiums Join Water & Sewer Costs as Threat to Affordable Housing



Insurance costs in NYC have been increasing significantly for the last 5-7 years and have become one of the largest annual operating expenses a project has, often ranging from $1,000 to $1,500 per unit. This is an issue that has been confronting many of our nonprofit and for-profit partners and we began analyzing the data from a number of buildings controlled by those partners.

The chart below summarizes data gathered on 202 apartment buildings with 5,820 apartments from 2018-2020. Anecdotal data indicates that the substantial increase in costs is continuing in 2021. Some properties are receiving quotes for umbrella insurance renewals of more than 70%. The combined cost of insurance in one set of buildings is in excess of the $1500 per apartment that some managers experienced in 2020.

Umbrella premiums increased 171% or $87 per unit; liability premiums increased 40% or $164 per unit, and property premiums increased 25% or $62 per unit.

Looking at disaggregated insurance premiums over the last 3 years, umbrella premiums increased 171% or $87 per unit; liability premiums increased 40% or $164 per unit, and property premiums increased 25% or $62 per unit. In other words, while umbrella premiums are the fastest increasing from a percentage perspective, they are not the sole problem. Liability premiums have had by far the largest absolute dollar increases over the past three years.

Importantly, we believe that rising insurance costs should be met with an effort to bring down premium costs. While much has been written on rising costs as of late, there is still work to be done to understand the roots of this trend and propose solutions that keep premiums reasonable without shifting the burden to tenants.

State legislation introduced by Senator Kavanagh and Assemblyman Cymbrowitz S.5231/A.5574 would require the New York State Department of Financial Services with the NYS Division of Housing and Community Renewal to launch a study to “examine the increases in insurance premiums and the lack of availability of insurance coverage for affordable housing developments in New York State” and to make recommendations to address the issue. As of May 18, 2021, the bill has passed the State Senate and is in the Assembly Ways and Means Committee.

To share your experience with insurance premiums in multifamily properties or to get involved contact Jim Buckley (, X 103

Join UNHP on Thursday, May 27 at 9 am for a Zoom Water and Sewer Update/ Email for the Zoom link

The Water Board and DEP are proposing a 2.76% beginning July 1, 2021; the proposal also includes an increase in the Multifamily Water Assistance Program by 20% raising the total amount to $12 million. Prior to this rate proposal, DEP contracted with a firm to make recommendations on reforming NYC’s water rate structure in upcoming years. We will also be discussing the importance of affordable housing issues in relation to planning for changes in NYC’s rate-setting structure.

The seminar is scheduled for Thursday, May 27th from 9-10:15 AM.

The Water Board is proposing a 2.76% water and sewer rate increase to take effect on July 1, 2021; as required, the Water Board is holding public hearings. They are scheduled remotely on

Tuesday, June 1, 2021, Hearing Starts at 12:00 p.m. Phone number: (347) 921-5612 Access code: 107 181 687 #

Wednesday, June 2, 2021, Hearing Starts at 6:00 p.m.Phone number: (347) 921-5612 Access code: 875 205 402 #

More DEP Water Hearing Information can be found here.

The full proposal is available at the following link: ; the 2021-22 rate proposal begins on Page 38 of the minutes of the May 10th meeting.

The Water Board is also accepting written testimony through their email: ; the proposals will be considered at the next Water Board meeting which has not yet been scheduled.