In March 2025, the Pubs Code Adjudicator (PCA) highlighted the critical importance of adhering to Regulation 46 of the Pubs Code, especially with regards to pubs and premises insurance. The regulation is designed to protect tied tenants by clarifying their rights and ensuring they are not unfairly charged for insurance premiums.
Understanding Regulation 46
Regulation 46 stipulates that pub-owning businesses must provide tenants with comprehensive information about the premises insurance arrangements, especially when tenants are liable for the costs. This includes details on how insurance premiums are calculated and providing tenants the invaluable opportunity to shop around for policies that may offer comparable cover at a lower price. By law, if a tenant finds an alternative policy that meets the standard of being “suitable and comparable,” the pub company has the obligation to either accept that policy or agree in writing not to charge the tenant the difference.
The Role of the PCA
The PCA’s advocacy for tenants stems from a compliance review conducted in 2024, specifically involving Star Pubs & Bars. This review revealed areas needing improvement regarding how insurance charges are communicated to tenants. As a result, the PCA issued guidance to all pub companies in October 2024, encouraging them to rectify their processes, particularly in scenarios involving self-insurance schemes.
Challenges Facing Tenants
Despite these regulations, there remains a concerning trend with some pub companies not properly honoring the rights of tenants to price match their insurance premiums. A significant issue reported is the confusion around what constitutes an equivalent insurance policy. Many companies erroneously reject tenant-proposed options based on an incorrect assessment of whether the proposed policies are “better” than their own. The PCA has made it clear that the legal requirement is for policies to be “suitable and comparable,” not necessarily identical.
Awareness of Rights Among Tenants
Alarming statistics from the PCA’s 2024 annual tied tenant survey indicate that only 56% of tied tenants are aware that they possess the right to challenge insurance costs through the price-matching mechanism. This lack of awareness is troubling as it could lead to many tenants incurring higher costs than necessary, ultimately affecting their profitability and sustainability.
Creating Clear Communication
In its latest reminders, the PCA encourages pub companies to re-evaluate their compliance with Regulation 46. It’s critical that communications with tenants are straightforward and articulate the price match right clearly. Businesses must avoid using technical or vague language that may overwhelm tenants, thereby giving them confidence to exercise their rights without facing obstacles.
Gathering Feedback and Improving Practices
In efforts to foster a fairer and more transparent atmosphere for tied pubs across England and Wales, the PCA is urging tied tenants and other stakeholders to share their experiences. Gathering feedback allows the PCA to evaluate whether these regulations are being upheld consistently across the industry. By promoting awareness and enforcing regulatory compliance, the PCA aims to ensure that all tenants are treated fairly.
As we move forward in nurturing the relationship between pub companies and their tenants, it is vital to recognise the significance of Regulation 46 in the realm of pubs and premises insurance. Better communication, heightened awareness among tenants of their rights, and fair treatment from pub companies will not only improve tenant experiences but also contribute to a more balanced industry. The PCA’s ongoing efforts to reinforce these regulations bring hope for a more equitable landscape in the pub industry, where the rights of tied tenants are protected, and businesses operate transparently. Working with resources like Simply Accounts Accountant Chester, Accountant Wrexham, Accountant Ellesmere Port, Accountant Shrewsbury or Accountant Crewe, can help ensure informed business decisions. Get in touch with us today for more help or advice.