Was scratching out required pet damage insurance from Renters’ Rights Act a missed opportunity?

On 27 October, it was announced that the Renters’ Rights Act 2025 was granted Royal Assent – legally laying down greater rights for tenants in England.

This includes stronger protections against eviction and more security in keeping pets.

While a step in the right direction, the new law received criticism by pet groups, insurers and law firms for only scratching the surface of protections for tenants who keep pets.

According to live rental listings data analysis by Zero Deposit, while 51% of adults own a pet, only 8% of UK rental properties are advertised as pet friendly.

These figures present the persistent issue that landlords are afraid to open their properties to pets because of the potential risk of damage.

However, while the current legislation increases tenants’ rights to keep pets by ensuring landlords cannot refuse without cause, in July 2025 the government made the decision to withdraw the clause that landlords must require tenants to have pet damage insurance from the Renters’ Rights Bill.

In the bill’s second report stage in the House of Lords, housing minister Baroness Taylor of Stevenage announced that the clause was being scrapped because “there is a risk” that the “relevant insurance does not come on to market sufficiently”.

The minister continued that the five weeks’ rent deposit would be sufficient to cover pet damage in accordance with the Tenant Fees Act 2019.

Richard Finan, managing director at Addept Insurance Services, said the retraction was a “retrograde step for landlords and tenants alike and [has been] widely condemned by landlord groups”.

Addept developed the Not for Lions pet damage insurance add-on to underlying landlords’ buildings insurance, which insurer Alps added to its portfolio in January 2025 in response to the proposed reforms.

“Despite the removal of landlords’ ability to recover the premium from the act, we have seen an increase in enquiries directly from landlords looking to access our cover since the decision was announced,” he continued.

“We are [also] receiving an increasing number of enquiries from brokers and MGAs looking to embed our cover within their core building policy to provide a valuable product enhancement to landlords.”

With a need for “greater access to protection” for landlords, Finan exclusively revealed to Insurance Times that it has expanded its distribution model of the product to enable its broker and MGA partners to offer the policy on a standalone basis.

Despite a seemingly strong demand for pet damage insurance in the market, it raises the question of why the opportunity to make this insurance a requirement was not snapped up.

Price perception

For founder of AdvoCATS pet legal services Jennifer Berezai, this retraction was a “sucker punch”.

The non-profit organisation was set up in 2018 to provide free legal advice to tenants and landlords with pets and was the organisation that initially raised the clause to be considered for the bill.

On the retraction, Berezai said: “The reasons they were coming up with were just nonsense.

“There’s no other word for it. They hadn’t investigated this element properly.”

In making the decision, the government consulted the ABI before concluding that the relevant insurance products “will not happen at the scale necessary”.

Commenting on its guidance to the government, an ABI spokesperson told Insurance Times that “pet-related damage tends not to be covered under landlords’ insurance policies”.

They continued: “As part of discussions around the Renters’ Rights Bill, we advised that if the government wished to introduce this requirement, insurers would need to assess a range of factors including affordability, risk appetite, the competitive market and consumer expectations.

“Following those conversations, the government has chosen to explore alternative solutions.”

After sending an open letter to the housing secretary, Berezai explained that she had a meeting with one of the pet policy advisers working on the bill at the ministry.

She said that she had told them why the insurance policy was so vital and that there were multiple companies offering the insurance which is available and “ready for inquiries at scale”.

Despite this, Berezai said that she believes she was “stonewalled”.

In his opinion, David Smith, partner at Spector, Constant and William, said he suspects the “real problem” was that those policies were priced higher than the government had anticipated and that they would be deemed unaffordable by the public.

According to research by the University of Huddersfield, published in March 2024, 49% of private landlords reported charging a pet rent surcharge to pet owners at an average of an additional £29.10 per month.

This is a total of £349 a year. However, the net rate of the policies at Alps to brokers is £99 and the match retail price is £120 per year, which covers up to £5,000, according to Nick Copley, head of claims at Alps.

Berezai said: “[The government] were concerned about another cost going on a tenant, completely ignoring what costs tenants can currently pay through pet rent through the landlords that will allow pets.”

Smith continued that ”there’s a cost to a tenant owning a pet that I would say is reasonably modest at £100 to £150 a year and if they can’t afford that, I would question whether they should have a pet at all”.

Extra risk

Believing the removal of the clause to be a “missed opportunity”, Copley said that no pet damage insurance also puts “landlords at extra risk”.

Copley noted that there is “value” in the product as the current five-week deposit limit offers limited protection, with average deposits of around £1,500 “swallowed up” by general cleaning and repairs.

In turn, he felt that tenants not needing to have pet damage insurance could backfire and “is likely to lead to increased rents” from landlords across the market as protection from pet-inflicted damage.

Although the government decision appears final, Smith stressed that the opportunity to overturn it “is not actually over”.

He concluded: “You can amend the Tenant Fees Act by regulation.

“So the government could U-turn and amend the Tenant Fees Act by regulation regardless of the Renters’ Rights Act having already been passed. They could change that position at any time if they felt sufficient pressure to do so.”