LOS ANGELES (CNS) - The Los Angeles City Council instructed staff Wednesday to conduct an analysis of insurance increases and how those costs are impacting developments for unhoused individuals.
Council members voted 12-0, and expect a report back within 90 days on the matter. Additionally, staff will provide potential state or federal action that could be taken to address the issue.
The action was initiated by a motion introduced by council members Katy Yaroslavsky, Paul Krekorian and Marqueece Harris-Dawson in December 2023.
According to the motion, dramatic hikes in insurance costs and the exit of several insurance carriers from the state's multifamily housing market are "increasingly jeopardizing" the development of supportive housing units for formerly unhoused individuals.
The council members noted that insurance costs have increased anywhere from 25% to 550% on properties -- which cannot be covered by simply raising rents. Some insurance carriers are not renewing policies, leading developers to acquire new policies at increased prices.
"While the insurance commissioner and state lawmakers are aware of the issue and are discussing various proposals, it is essential to understand the depth of the challenge faced locally, as the failure to curb these skyrocketing costs will result in a reduction of new supportive housing being developed," the motion reads.