New York Governor Kathy Hochul has announced a $2 million loan to Milford Street, a captive created, owned and operated by members of New York’s affordable housing industry to combat rising liability insurance premiums. The loan came from Empire State Development (ESD).
The loan was first announced in February but has now been formally approved. [https://www.captiveinternational.com/new-york-housing-captive-could-get-loan-boost]
“New York is the best state to raise a family, and through my Let Them Build initiative, we’re building more homes faster so that new and current families can have long-lasting opportunities here — but we can’t stop there,” Governor Hochul said. “This investment in Milford Street will continue to advance our housing agenda, leading to more affordable units built for tenants. We need to build in New York, and we’re going to support the partnerships that will tackle these insurance costs.”
New York City affordable housing liability insurance premiums increased at an annual rate of 21 percent between 2019 and 2023, per a March 2024 report by the New York Housing Conference. These rising costs discourage the development of new affordable housing, place pressure on affordable rents and carrying charges, and force current operators to defer necessary maintenance, adversely impacting housing quality.
In a statement Governor Hochul said she is committed to addressing high insurance costs, and the investment in Milford Street Captive Insurance complements other efforts to tackle increasing housing insurance premiums. In February, New York State Homes and Community Renewal (HCR) announced the administrators for its $5 million Risk Reduction and Insurance Affordability pilot program, the first program in the nation to help non-profit housing providers reduce costs by using insurance captives. The program was created as part of the Governor’s FY 2026 Enacted Budget in order to assist non-profit affordable housing providers, giving them new tools to maintain affordability and keep costs down for tenants. Urban Homesteading Assistance Board and Housing Partnership Network will work directly with non-profit affordable housing providers across the state to assess the risk profile of their properties and assist them in using insurance captives.
ESD president chief executive and commissioner Hope Knight said, “Bold ideas and innovative thinking are required to overcome the current affordability crisis. The partnership with Milford Street Captive Insurance Company reflects ESD’s commitment to working with the broader housing community on solution-oriented strategies that advance Governor Hochul’s ambitious housing agenda.”
New York State HCR commissioner RuthAnne Visnauskas said, “New York’s $2 million investment in the Milford Street insurance collective demonstrates Governor Hochul’s focus on driving down costs and reinvesting those savings where they matter most — in maintaining high‑quality homes for the people who live in them. Building on HCR’s Risk Reduction and Insurance Affordability pilot program, this initiative gives affordable housing owners and developers a powerful tool to stabilize expenses, protect their properties, and ultimately create better, more affordable places for tenants to live. This is one of the many ways that Governor Hochul’s commitment to affordability is empowering our partners and creating the opportunities New Yorkers deserve.”
Milford Street founding member and work force housing group member John Crotty said: “The Governor’s support is critical to not only the success of Milford Street Captive Insurance Company, but to the continued health and existence of New York’s Affordable Housing Market. Rising insurance premiums are putting intense pressure on the thin margins of affordable housing operators, resulting in fewer projects being underwritten, defraying necessary maintenance and eventually forcing some buildings into bankruptcy. I commend Governor Hochul for recognizing the need for innovative solutions to the national affordable housing insurance crisis and boldly acting. Her leadership is critical for New York and the nation.”
The low-interest $2 million loan from ESD, which was approved by ESD’s Board of Directors last year, will increase participation in the captive by using the loan funding to cover a portion of the initial capital contribution membership costs. Increasing membership is essential to the long-term success of the captive, and ESD’s loan enables the captive to be more affordable to its members.
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