NSW Ends No-Grounds Evictions — Is Your Landlord Insurance Still Valid?
As of May 2025, tenancy laws in New South Wales have changed significantly. Landlords can no longer terminate a lease at the end of a fixed term without a valid reason. These reforms affect how leases operate and, importantly, how landlord insurance policies respond.
What Has Changed?
Previously, landlords could end a fixed-term agreement without providing a reason — often as a way to manage tenancy cycles or regain control of the property. Under the new legislation:
- "No grounds" terminations at the end of fixed-term leases are no longer permitted.
- When a fixed-term lease expires, it automatically rolls into a periodic (month-to-month) agreement unless both parties agree to renew.
- Termination is only allowed under specific grounds, such as selling the property, owner occupation, or tenant breach.
As a result, landlords no longer have the ability to insist on a new fixed-term lease. Periodic agreements are now the standard in many tenancies.
Why This Affects Landlord Insurance
Many traditional landlord insurance policies are written with the assumption that a fixed-term lease is in place. This creates potential issues, such as:
- Limited or no coverage for periodic agreements
- Denied claims for loss of rent if a tenant defaults during a periodic tenancy
- Higher excess or exclusions applied when a fixed-term lease is not active
Now that periodic leases are likely to be the default arrangement in NSW, relying on an insurance policy that doesn’t explicitly cover them could leave landlords financially exposed.
What Landlords Should Do
If you own an investment property in NSW, now is the time to:
- Review your landlord insurance policy
Check the fine print for references to tenancy types. Look for any limitations on periodic lease coverage. - Speak with your insurer or broker
Confirm your policy includes protection for rent default, tenant damage, and legal liability under a periodic agreement. - Upgrade if necessary
Some insurers now offer policies specifically adapted to the May 2025 tenancy law changes. These products are better aligned with the new rental landscape. - Speak to your Property Manager
We have access to tailored insurance options through our company broker, which are typically better options than those available through retail channels. Please speak to your Property Manager to discuss and get a copy of the policy documents.
Final Thought
The end of no-grounds evictions is more than a legal update — it affects how you manage risk as a landlord. If your insurance policy hasn’t been reviewed since the new laws came into effect, it’s worth checking that your coverage reflects today’s rental environment.
An outdated policy could leave you vulnerable when you need protection most.
Disclaimer:
This article contains general information only and does not take into account your individual circumstances. You should consider whether the advice is appropriate for your needs and always refer to the relevant Product Disclosure Statement (PDS) before purchasing or renewing any insurance policy. For tailored advice, consult a licensed insurance professional.