Across the country, affordable housing developments have been hit with dramatic year-over-year increases in insurance rates with no end in sight. In the Gulf Coast, both for-profit and nonprofit housing providers are grappling with how to deal with the climbing costs, by negotiating policies with higher deductibles, dipping into operational reserves, and taking loans to cover the gap.
Enterprise conducted this insurance analysis to provide concrete data on what is often talked about in general or anecdotal terms. By highlighting the issue, we hope that policymakers and the public understand the consequences of the insurance crisis on the Gulf Coast affordable housing industry and the critical need to mobilize action at the state and federal levels.
Our analysis of insurance costs of 52 properties in our Gulf Coast Low-Income Housing Tax Credit portfolio – across Mississippi, Louisiana, Alabama, and Texas – found that premiums per unit have increased from $586 in 2017 to $1,205 in 2023, representing a 12.8% average yearly increase over the six-year period.
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