Philadelphia Crime Has Forced Insurance Rates ‘Through the Roof’ and Is Leading to Closures, Business Owners Say

As shoplifting and lootings overtake Philadelphia, business owners say insurance prices are becoming astronomical — if they’re able to find an insurance provider at all. The city has taken center stage in the national conversation on urban decay in recent months, as mass store lootings have destroyed properties and 70 percent of the city’s residents say crime and public safety are the most important issues, as The New York Sun has reported. It’s also a frequent stop of President Biden — his trip there last week to talk about the economy was his eighth visit this year alone — as it’s the largest city in a key battleground state.Yet convenience store and gas station owners say the spiking insurance rates, caused by the city’s downward trend and crime crisis, is starting to put them out of business.“Out here in Philadelphia all the insurance rates are through the roof and it’s going to come to the point where franchises or the small-business people won’t be able to afford liability insurance and other kinds of insurance,” one franchise owner, Vincent Emmanuel, who runs a 7-Eleven store in South Philadelphia, tells the Sun. “You see that one after the other stores are closing, small-business people and even the big-business people are really having a tough time,” he says. The number of insurance claims and the location of a business can make prices higher, he says, and those costs are passed to consumers. Mr. Emmanuel says his franchise is on an old insurance policy, but will be coming up for renewal this year, and he’s “already been hearing horror stories” from other business owners. “Most of the franchises are constantly asking where could we find some insurance cheaper. Because there’s a lot of liability issues involved,” he says, “nobody wants to write additional insurance policies.” In the absence of a strong law enforcement presence, some local businesses have taken to arming themselves, which they say is an effort to protect their employees. “The other day on Broad Street I walked into a store — they have a security guard standing there with a machine gun,” Mr. Emmanuel says, adding that it was in broad daylight. “The guy has two pistols on the side and he has a machine gun,” he says. “To buy a soda, I got scared. That’s how bad it was.“ Some franchise owners have had to sell locations because of the crime and increasing insurance rates, such as the president of the Franchise Owners Association, Manzoor Chughtai. He tells the Sun he sold a convenience store in the city because of “too much crime,” not being able to find people to work there, and “paying too many expenses on insurance.” “Everybody’s backing out,” Mr. Chughtai says of insurance providers. “Anybody who wants to write it, it’s going to be close to $10,000-$12,000. Before we were paying $2,000-$3,000.” Mr. Chughtai sold his last franchise in the city, but is keeping another store in a suburban area where crime is lower.Another Philadelphia multi-franchise owner, who asked to remain anonymous out of concern that his businesses could be targeted, tells the Sun he was paying $7,000-$8,000 for insurance four years ago, but that number has skyrocketed to $37,000 a year. “I’ve been in the business for over 25 years so I’ve had the same insurance rep at the same company, but now they’re even telling me they might not want to renew,” he says, adding that “they don’t want to have convenience stores or grocery stores on their portfolio” especially in urban areas with rioting, like Philadelphia. If insurance prices continue to climb — or if he’s unable to find an insurance provider — he says “we’re going to have to close some of the businesses,” or stop keeping them open 24 hours. It’s “because of the insurance, not because of lack of business,” he adds, noting that providers don’t want to carry because “if you look at any looting video, it’s gas stations, convenience stores, the ATMs, and people have been shot, employees have been shot.” Many people are afraid to say anything about it, he adds, because they don’t want to become a target of crime. Cops are not motivated or enabled to do anything, he says, because if they make an arrest, many criminals still aren’t prosecuted or even charged with crimes. “I’ve had my windows smashed before, I’ve had my tire stabbed before with a knife, this past Monday, I had somebody hold a lighter next to the gas pump nozzle and almost try to blow up my whole station,” he says. “I called the cops, cops came 15 minutes later, they just did a whole loop around the property and then just left.”

Philadelphia Crime Has Forced Insurance Rates ‘Through the Roof’ and Is Leading to Closures, Business Owners Say

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