Unmarried couples could be ordered to sell their home, pay lump sums and share pensions in the event of a break-up, the Government's law reform advisers said yesterday.
The Law Commission said the two million Britons who "live in sin" should be able to make financial claims against each other in some circumstances.
A partner should generally be able to make a claim if they made "economic sacrifices" during the relationship such as giving up a career to raise children, and the benefits were unfairly shared at a split.
The decision was welcomed by the West Midlands chairman of a national family law organisation, who said it would pave the way for provision for vulnerable partners if their relationship fails.
Zahra Pabani, chairman of Resolution West Midlands, said the conclusion of the law reform advisors was a victory after five years of campaigning by the group.
But the Archdeacon of Birmingham Hayward Osborne said it was a step in the wrong direction, saying marriage was the best option for those who wanted financial protection under law.
The measures, said the report, would be "more limited in scope" than divorce laws, but the courts would be able to order sale of property, lump sums, monthly payments, pension sharing and interim payments.
The Commission also said it favoured the "clean break" principle used in divorce laws, which sees claims settled quickly by transferring the family home or a lump sum to a partner rather than carrying on a long-term legal row.
Ms Pabani, partner and family law specialist at Shakespeares, said new legislation was essential because more people than ever before were living together.
"Everyone goes round with this popular assumption that there's this thing called a common law husband or wife and I have rights, but there's no such thing," she said.
"When I see unmarried people in relationship breakdown they are shocked and appalled and devastated when I say the first rule of law is that you get nothing.
"That person might have put in years of hard work decorating or bringing up the children or been paying the bills, but if the house is not in his or her name, they have absolutely no claim on it.
"At present to make a claim we have to go through trust common law and it is incredibly complicated.
"This law is to protect the financially vulnerable and we don't protect them at the moment."
The Venerable Hayward Osborne said the new legislation discouraged marriage.
"I would encourage people to get married, whether they are religious or not," he said.
"Firstly, because the mechanism exists and we don't have to start inventing new legislation.
"Secondly, although marriages do fail there's actually clear evidence that when a relationship has the stability of marriage it provides a better environment for children growing up. It is better if a couple go and declare their determination to make their relationship work.
"Drawing up a legal document with the emphasis on what if we fail, that does not show total commitment."
The Commission, headed by High Court judge Sir Roger Toulson, insisted the measures would not damage the institution of marriage by encouraging couples to live together.
They could actually encourage more people to wed because partners would no longer avoid financial responsibilities to lovers by living together instead of getting hitched, it suggested.
"We think that a new scheme should only provide eligible applicants with a remedy on separation if they can show that the effects of the contributions and associated economic sacrifices they made during the relationship would otherwise be unfairly shared on separation," said the report.