One unsuspecting cause of a dwindling nightlife scene in NYC: lawsuits. Nightclubs and restaurants are facing increasingly high insurance rates due to the increased amount of lawsuits they are facing, according to a recent article in the New York Times. 

According to a report from the Council of Insurance Agents & Brokers, in the third quarter of 2024, insurance premiums in the commercial property and casualty market rose by 5.1 percent from the previous quarter, showing a spark spike in price most small businesses cannot afford. 

Jelani Fenton, chief executive of E.G. Bowman Co., an insurance agency based in New York, told the New York Times:

“Restaurants, bars and other establishments could get pulled into a lawsuit from a client who injures a third party after a night of drinking, so many insurance carriers are adjusting pricing for the increased risk of a lawsuit that names the restaurant as the ‘at-fault’ party.”

Two owners of a mid-size club in Williamsburg reported that their insurance costs had gone from $25,000 to $125,000 over their twelve years of doing business. Mr. Gulez, an owner, said: 

“It’s almost like we’re fighting against all these obstacles. And then at some point, like, especially when you age, you say, ‘Well, what are we doing here? Just working for insurance companies.’ It’s almost like we make money, and then on the first day of the month, we just hand it over.”

Now is the time for New York to take action and protect its small businesses against excessive litigation and skyrocketing prices.