New York Steps in to Help Affordable Housing Insurance Venture

New York State is giving a collective of affordable housing landlords a helping hand.

The Empire State Development Corporation is issuing a $2 million low-interest loan to the Milford Street Captive Insurance Company, Gothamist reported. The captive — a first-of-its-kind collective of landlords funding their own liability insurance coverage — is believed to be the first in the country focused solely on affordable housing.

Workforce Housing Group’s John Crotty, a member of the captive, called the ESDC’s involvement a “big, big deal,” and said he hoped it will be the next step in getting more members to join or more funding from philanthropic organizations.

Landlords of subsidized housing started the captive last year as private-market insurance premiums doubled over a five-year span. Market-rate landlords can make up the difference by raising rents, but affordable housing landlords are hamstrung by qualification requirements.

Members of the captive insure about 3,000 apartments in the city, doing so at a fraction of the costs other affordable housing landlords are facing. Last year, the New York Housing Group released a report that found insurance rates for the city’s affordable housing jumped by an average of more than 25 percent each year from 2019 to 2023.

The issue has also drawn the attention of Gov. Kathy Hochul. As laid out in her 2025 “State of the State” policy book, the governor said she wanted the state to help nonprofit housing groups meet criteria to benefit from lower insurance costs.

Liability insurance is necessary for landlords to cover costs for potential damages or lawsuits. Going without is not an option since lenders won’t provide mortgages without the insurance in place.

Separately, affordable housing investor Enterprise Community Partners found that per-unit costs in the city increased by 75 percent from 2017 to 2023.

— Holden Walter-Warner