Introduction
The Renters' Rights Act 2025 represents the biggest change to how private renting works in England for a generation, and it affects landlords whether they own a single buy-to-let or a substantial portfolio. While the Act itself is a piece of housing and tenancy law, not insurance law, it changes the practical risks landlords face, particularly around rent arrears, regaining possession, and the time and cost involved in resolving disputes, all of which have a direct bearing on landlord insurance. This guide explains what the Act actually changes, and then looks specifically at what it means, and doesn't mean, for your landlord insurance cover.
This guide complements our main Landlord Insurance UK guide and our Rent Guarantee Insurance UK guide, which covers rent protection cover in detail.
Key Terms Explained
- Section 21 Notice
- The current mechanism allowing a landlord to end an assured shorthold tenancy without giving a specific reason, being abolished under the Act.
- Periodic Tenancy
- A tenancy with no fixed end date, continuing on a rolling basis (typically month to month) until ended by the tenant or landlord in line with the law.
- Grounds for Possession
- The specific, legally defined circumstances (such as rent arrears or a landlord wanting to sell) a landlord must rely on to regain possession once Section 21 is abolished.
- Private Rented Sector (PRS) Database
- A new government register that private landlords in England must join, providing information to tenants, councils and landlords themselves.
- Private Rented Sector Landlord Ombudsman
- A new, mandatory redress scheme giving tenants a free route to raise and resolve complaints about their landlord outside the courts.
Why This Matters
For landlords, understanding the Renters' Rights Act properly matters because it changes core assumptions many have relied on for years, particularly the ability to end a tenancy without giving a reason. Misunderstanding the new rules, whether by continuing to rely on Section 21 after it's abolished, or by not registering on the new database or joining the Ombudsman when required, risks both an inability to regain possession when genuinely needed and exposure to civil penalties. Separately, understanding how the changed risk landscape interacts with landlord insurance helps landlords make an informed decision about their own cover, rather than assuming their existing policy automatically adapts to the new framework.
Overview of the Act
According to the government's official guide to the Act, the Renters' Rights Act delivers on a manifesto commitment to transform private renting for England's roughly 11 million private renters and 2.3 million landlords. Its core measures include abolishing Section 21 evictions and moving to an all-periodic tenancy system, clarifying and expanding grounds for possession, restricting rent increases to a single statutory process, introducing the PRS Landlord Ombudsman and PRS Database, banning discrimination against tenants with children or receiving benefits, ending rental bidding, strengthening tenants' rights to request a pet, applying the Decent Homes Standard and Awaab's Law to the private rented sector, and strengthening local council enforcement powers and rent repayment orders.
Royal Assent and Implementation Timeline
The Act completed its passage through Parliament and received Royal Assent on 27 October 2025. The government has been implementing its provisions in phases through 2026 rather than all at once, publishing a separate implementation roadmap alongside the Act itself. Local councils gained stronger inspection and investigatory powers in December 2025, and the core new tenancy system, including the abolition of Section 21 and the conversion of existing tenancies to the periodic model, forms the centrepiece of the first major implementation stage, applying to both new and existing tenancies from the same date so the sector avoids a confusing two-tier system.
Section 21 Abolition Explained
Under the current system, a landlord can generally end an assured shorthold tenancy without giving a reason, using a Section 21 notice with two months' notice, and the court must order eviction if the tenant hasn't left by the end of that period. The Act abolishes this entirely. Once the new system applies, landlords will only be able to end a tenancy by relying on one of the specific, legally defined grounds for possession, providing evidence to a court if the tenant doesn't leave voluntarily.
The Move to Periodic Tenancies
Fixed-term assured shorthold tenancies are being removed entirely. Instead, all tenancies become periodic, meaning there's no fixed end date, and a tenant can remain in the property until they choose to leave (by giving two months' notice) or until the landlord obtains possession using a valid ground. According to the government, this removes the situation where tenants are obliged to keep paying rent on a substandard property for the remainder of a fixed term, while also giving both parties more flexibility to respond to changing circumstances.
Grounds for Possession: What Changes
The Act clarifies and expands the grounds for possession landlords can rely on. Grounds are split into mandatory grounds, where the court must award possession if the ground is proven, and discretionary grounds, where the court considers whether eviction is reasonable even if the ground is met. Key grounds relevant to most landlords include:
| Ground | Purpose | Notice Period |
|---|---|---|
| Landlord or family moving in | Landlord or close family wants to occupy the property; cannot be used in the first 12 months of a tenancy | 4 months |
| Sale of the property | Landlord wants to sell; cannot be used in the first 12 months of a tenancy | 4 months |
| Mandatory rent arrears | Tenant has at least 3 months' rent arrears (increased from 2 months) at notice and hearing | 4 weeks (increased from 2) |
| Any rent arrears (discretionary) | Tenant is in any amount of arrears | 4 weeks |
| Anti-social behaviour | Tenant or visitor causing nuisance or committing certain offences | Immediate in serious cases |
| Breach of tenancy | Tenant breaches a term of the tenancy agreement other than rent | 2 weeks |
Landlords using the move-in or sale grounds cannot do so in the first 12 months of a new tenancy, must give four months' notice, and cannot re-market or re-let the property for 12 months afterwards, a safeguard designed to prevent these grounds being used as a disguised route around the abolition of Section 21.
Rent Arrears: New Thresholds and Notice Periods
For the mandatory rent arrears ground, the threshold is increasing from two months' arrears to three months' arrears (or 13 weeks if rent is paid weekly or fortnightly), and the required notice period is increasing from two weeks to four weeks. According to the government, this gives tenants who fall into temporary arrears more time to repay and remain in their home, while landlords retain the discretionary arrears ground, for example where rent is persistently paid late, as an additional option.
Rent Increases and the Tribunal Process
All rent increases in the private rented sector will use a single statutory process: landlords serve a "section 13" notice giving at least two months' notice of a new rent at market rate. Rent review clauses within tenancy agreements will no longer be permitted as an alternative route. If a tenant believes the proposed increase exceeds market rate, they can challenge it at the First-tier Tribunal, which will determine the correct market rent; government guidance confirms tenants will never end up paying more than the landlord originally proposed, and rent increases will no longer be backdated.
Restrictions on Rent in Advance
The Act amends the Tenant Fees Act 2019 to prohibit landlords and letting agents from requiring or accepting rent in advance before a tenancy agreement is signed. Once signed, a landlord can require up to one month's rent (or 28 days' rent for shorter rental periods) before the tenancy starts, but cannot enforce any tenancy term requiring rent to be paid in advance of its due date once the tenancy is underway. Breaches can result in a local council ordering repayment to the tenant and imposing a civil penalty of up to £5,000.
The Private Rented Sector Landlord Ombudsman
A new Private Rented Sector Landlord Ombudsman Service is being introduced, which all private landlords of assured or regulated tenancies in England, including those using a managing agent, will be legally required to join. Tenants can use the service free of charge to raise complaints, and the Ombudsman has powers to require a landlord to apologise, provide information, take remedial action, or pay compensation, with decisions binding on member landlords. Landlords who fail to join, or who market a property while unregistered, face civil penalties of up to £7,000 for initial breaches, rising to £40,000 or criminal prosecution for repeated or serious breaches.
The Private Rented Sector Database
All landlords of assured and regulated tenancies must register themselves and their properties on a new Private Rented Sector Database, intended to act as a single access point for guidance and to help demonstrate compliance. Landlords who let or advertise a property without registering can face a civil penalty of up to £7,000, rising to £40,000 or criminal prosecution for repeated or serious breaches such as providing fraudulent information, and landlords in breach of the registration duty will generally be unable to obtain a possession order (except for anti-social behaviour grounds) until they register.
Banning Discrimination Against Tenants
The Act makes it unlawful for landlords and agents to refuse a prospective tenant because they have children or receive benefits, addressing both overt practices, such as "no DSS" adverts, and more indirect ones. Landlords retain the right to assess affordability and carry out referencing checks, but cannot use children or benefit receipt itself as grounds for refusal. Breaches can result in civil penalties of up to £7,000 per breach, with multiple penalties possible for repeated conduct.
Ending Rental Bidding
Landlords and letting agents will be required to publish an asking rent for a property and will be prohibited from asking for, encouraging, or accepting offers above that published rent. This directly targets the practice of pitting prospective tenants against each other in informal bidding wars for scarce properties, with civil penalties of up to £7,000 available for breaches.
Renting With Pets: What Changes
The Act strengthens tenants' rights to keep a pet, requiring landlords to properly consider requests on a case-by-case basis and not unreasonably refuse, with tenants able to escalate an unreasonable refusal to the new Ombudsman or to court. Importantly for landlords considering their insurance position, official government guidance states that pet-related damage is expected to be covered through the tenant's existing deposit, with a landlord able to pursue a tenant through the courts for damage exceeding the deposit only in rare cases, rather than the Act creating any separate, mandatory requirement for tenants to hold pet damage insurance.
Decent Homes Standard and Awaab's Law
For the first time, a Decent Homes Standard will apply to the private rented sector, giving local councils enforcement powers over property condition in a way previously reserved largely for social housing. Alongside this, "Awaab's Law", which sets clear legal timeframes for landlords to act on serious hazards such as damp and mould, is also being extended to private renting. Together, these measures increase the practical and financial consequences for landlords who don't keep a property in good repair, which is a factor worth considering alongside your buildings insurance and any home emergency or maintenance cover.
Enforcement Powers and Penalties
Local councils have been given expanded civil penalty powers, new investigatory powers, and a requirement to report on their enforcement activity, giving the reforms teeth at a local level. Penalties across the various new duties, registration, ombudsman membership, discrimination, rental bidding and rent in advance, range up to £7,000 for a first or lower-level breach and up to £40,000, or criminal prosecution in serious cases, for repeated or more serious non-compliance.
Rent Repayment Orders
Rent repayment orders, which allow a tenant or council to reclaim rent paid to a landlord who has committed certain housing offences, are being strengthened under the Act. The maximum penalty is being doubled, the orders are being extended to cover superior landlords (not just the immediate landlord), and repeat offenders will be required to repay the maximum amount rather than a lesser sum, significantly raising the financial stakes for landlords who don't comply with their legal obligations.
What This Actually Changes for Landlord Insurance
The Renters' Rights Act is tenancy and housing law, not insurance law, and it does not directly rewrite landlord insurance policy wording or make landlord insurance a legal requirement. What it does change is the underlying risk landscape landlords are insuring against. With Section 21 abolished, a landlord facing a difficult or non-paying tenant can no longer simply serve a no-fault notice; they must build a case under a specific ground, which can take longer and involve more uncertainty than before. This makes products like rent guarantee insurance, and the legal expenses cover many landlord policies include or offer as an add-on, more directly relevant to the practical risks landlords now face.
Existing Insurance Contracts and Discrimination Clauses
One area where the Act directly intersects with insurance contracts is the discrimination ban. According to official government guidance, some existing landlord insurance contracts have historically included terms restricting cover if a landlord lets to tenants receiving benefits or with children. Under the Act, existing insurance contracts that began before the relevant provisions come into force remain exempt until the contract ends or is renewed, but any new insurance contract entered into after the provisions take effect cannot lawfully include such restrictive terms, which will be of no legal effect. The government also notes that many insurers already offer cover for landlords letting to these tenant groups.
Rent Guarantee Insurance and Rising Demand
Industry reporting has highlighted a marked increase in landlord demand for rent guarantee insurance around the time the Act received Royal Assent, reflecting concern about the time and difficulty involved in recovering possession from a tenant in arrears once Section 21 is no longer available as a fallback option. Rent guarantee insurance is designed to cover lost rental income if a tenant stops paying, and some policies also include cover for the legal costs of pursuing possession. Our Rent Guarantee Insurance UK guide explains how this cover works in detail.
Void Periods and Longer Possession Timescales
Because landlords must now rely on specific grounds, provide longer notice periods in several cases, and potentially navigate court proceedings if a tenant doesn't leave voluntarily, the practical time between deciding to regain possession and actually doing so may increase in some circumstances compared with a straightforward Section 21 notice. This has a knock-on effect on void period risk, meaning the period a property sits empty and rent-generating between tenancies, which is a relevant consideration when reviewing both rent guarantee cover and your policy's position on unoccupied property.
Legal Expenses Cover and Possession Disputes
Many landlord insurance policies include, or offer as an add-on, legal expenses cover, which can help with the legal costs of pursuing a genuine possession claim through the courts if a tenant doesn't leave voluntarily once a valid ground applies. Given that Section 21's abolition removes the more straightforward no-fault route, and landlords must instead evidence a specific ground to a court if disputed, legal expenses cover is worth reviewing carefully as part of your overall landlord insurance package.
What Landlord Insurance Doesn't Cover Under the Act
It's important to be realistic about what landlord insurance can and can't help with under the new framework. Civil penalties and fines for failing to join the Ombudsman, register on the database, or comply with discrimination or rental bidding rules are regulatory penalties, and insurance generally cannot, and as a matter of public policy generally should not, cover fines of this kind. Similarly, Ombudsman-ordered compensation payments to a tenant for a landlord's own poor conduct are not the kind of insurable risk landlord insurance is designed to address. Compliance with the new registration and ombudsman requirements is a landlord's own direct responsibility, not something insurance can substitute for.
Accidental and Reluctant Landlords
If you've become a landlord unintentionally, for example by inheriting a property or being unable to sell before relocating, the compliance burden introduced by the Act, registering on the database, joining the Ombudsman, and understanding the new grounds for possession, applies to you in exactly the same way as to an experienced portfolio landlord. Our Accidental Landlord Insurance UK guide covers the specific insurance considerations that apply if you find yourself in this position.
Practical Steps for Landlords
As the reforms are implemented through 2026, sensible practical steps include reading the government's official guidance for landlords in full, registering on the PRS Database and joining the Ombudsman service as soon as these become mandatory for your tenancies, reviewing your standard tenancy agreements and any rent-in-advance practices for compliance, and reviewing your landlord insurance policy, particularly rent guarantee and legal expenses cover, in light of the changed possession process. If you use a letting agent, confirm directly with them how they're adapting their processes, since you remain legally responsible for compliance even where an agent manages the property day to day.
Common Mistakes to Avoid
- Continuing to rely on Section 21 notices after they're abolished for your tenancies.
- Assuming landlord insurance automatically adapts to cover the new legal landscape without you reviewing your policy.
- Not registering on the PRS Database or joining the Ombudsman service once these become mandatory.
- Assuming pet damage requires a separate mandatory insurance product rather than being addressed through the deposit.
- Continuing restrictive "no children, no benefits" terms in new insurance contracts taken out after the relevant provisions apply.
- Underestimating how a longer or disputed possession process could affect void periods and rental income.
Common Myths
- Myth: The Renters' Rights Act makes landlord insurance compulsory. It doesn't; it changes the risks landlords are exposed to, which makes appropriate cover more relevant, not legally mandatory.
- Myth: Landlords can no longer ever evict a tenant. Landlords retain robust grounds for possession, including for rent arrears, anti-social behaviour, sale, and moving in, but must use a specific ground rather than a no-fault notice.
- Myth: Tenants must buy pet damage insurance under the new pet rules. Government guidance points to the tenancy deposit, not a separate mandatory insurance product, as the primary route for recovering pet-related damage.
- Myth: Existing landlord insurance contracts with restrictive tenant clauses become void immediately. Existing contracts are exempt until they end or are renewed; only new contracts entered into after the relevant provisions apply are affected.
Real-World Examples
Example: Reviewing Rent Guarantee Cover
A landlord with a single buy-to-let property, concerned about the practical process of regaining possession from a non-paying tenant once Section 21 is abolished, reviewed and added rent guarantee cover with legal expenses protection to their existing landlord insurance policy ahead of the tenancy reforms taking effect.
Example: Renewing an Insurance Policy With Restrictive Terms
A landlord renewing their landlord insurance policy discovered their previous policy had included a term effectively discouraging letting to tenants on benefits; on renewal after the relevant provisions applied, their insurer confirmed the updated policy no longer included this restriction.
Example: Registering on the PRS Database
A portfolio landlord managing several properties through a letting agent confirmed directly with the agent that registration on the new Private Rented Sector Database and Ombudsman membership were being handled correctly for every property, rather than assuming this was automatically covered by their existing agency agreement.
Frequently Asked Questions
Does the Renters' Rights Act make landlord insurance compulsory?
No. The Renters' Rights Act does not make landlord insurance a legal requirement. However, it changes the risk landscape for landlords in ways that make appropriate cover, including rent guarantee and legal expenses cover, more important to consider.
When did the Renters' Rights Act take effect?
The Renters' Rights Act received Royal Assent on 27 October 2025. Its provisions are being implemented in phases through 2026, with the core new tenancy system, including the abolition of Section 21, and stronger council enforcement powers among the earliest measures to take effect.
Can landlords still require pet insurance under the Renters' Rights Act?
According to the government's official guidance, pet-related damage is expected to be covered through the tenant's deposit, with landlords able to pursue a tenant through the courts for damage exceeding the deposit in rare cases, rather than the Act creating a separate mandatory pet insurance requirement.
Do existing landlord insurance policies need to change because of the Act?
The Act doesn't directly rewrite landlord insurance policy wording. However, government guidance confirms that any new insurance contract containing terms restricting letting to tenants with children or receiving benefits will be of no legal effect once the relevant provisions are in force, while existing contracts are exempt until they end or are renewed.
Will rent guarantee insurance become more important under the new rules?
Industry reporting has highlighted a significant rise in landlord demand for rent guarantee insurance around the time the Act received Royal Assent, reflecting concern about the practical difficulty of recovering a property from a tenant in arrears once Section 21 is abolished.
Does landlord insurance cover Private Rented Sector Ombudsman decisions or fines?
Standard landlord insurance is not designed to cover regulatory fines or civil penalties, which are generally uninsurable as a matter of public policy. Legal expenses cover, where included, may help with the cost of defending a dispute or seeking advice, but check your specific policy wording.
What should landlords do now in response to the Act?
Read the government's official guidance for landlords, register on the Private Rented Sector Database and join the Ombudsman service once these become mandatory, review your tenancy agreements and rent-in-advance practices, and review your landlord insurance cover, particularly rent guarantee and legal expenses cover, in light of the new tenancy and possession framework.
References and Editorial Standards
This guide is reviewed regularly by the ShopTera Editorial Team and reflects the Renters' Rights Act 2025 as explained in the Ministry of Housing, Communities and Local Government's official published guidance, "Guide to the Renters' Rights Act", including its stated overview, timeline, grounds for possession, and frequently asked questions on insurance-related and pet-related provisions. Implementation of the Act is being phased through 2026, and specific dates, thresholds and requirements may be subject to further government guidance and secondary legislation, so always check the latest official gov.uk guidance for your specific circumstances. This guide is intended for general educational purposes and does not constitute legal advice; landlords facing a specific possession or compliance question should consider seeking independent legal advice.
| Version | Date | Change |
|---|---|---|
| 1.0 | 21 August 2026 | Initial publication |
Conclusion
The Renters' Rights Act 2025 fundamentally changes how tenancies work in England, and while it doesn't make landlord insurance compulsory or directly rewrite policy wording, it meaningfully changes the risks landlords are managing, particularly around regaining possession, rent arrears, and compliance with a new set of registration and redress requirements. Understanding what the Act actually requires, rather than relying on secondhand summaries, and reviewing your landlord insurance cover alongside it, puts you in a much stronger position as the reforms continue to be implemented through 2026 and beyond.