Pet damage in rentals – we have you covered

Most states have taken the lead and updated tenancy laws to allow for more open and honest communication about renting with pets. In fact, some states have prevented the exclusion of pets being written into leases all together.

This has made landlords and property managers nervous. There is a perception that furry friends can cause significant damage. However, the truth is that more damage at a rental is typically caused by a human opposed to a pet. And, with the right insurance, landlords are protected should the unexpected happen.

Let’s go deeper into insurance…

Is pet damage included in all landlord insurance policies?

Not all landlord insurance policies offer cover for pet damage. And, when they do, it is often covered with a sub-limit and high excess. However, EBM RentCover was one of the first insurers to offer this policy feature, because we know it is a need of landlords, and it is now a standard inclusion in RentCover Ultra and Platinum policies (we offer up to $70,000 cover for pet damage).

What is a sub-limit?

To understand what a sub-limit is, you first need to know what a limit is. A limit determines the maximum amount of money an insurance company will pay for a covered claim. A sub-limit is an additional limitation on cover. It is a ceiling of how much you can claim on very specific losses. For example, an insurer may have a limit of up to $65,000 cover for building damage, but a sub-limit of $2,500 for damage caused by a pet. This means that even if a pet causes $10,000 worth of damage, the landlord can only claim up to $2,500. At EBM RentCover, we do not have a sub-limit for pets and offer up to $70,000 cover.

Could a pet really cause up to $70,000 in damage?

As we have noted, most damage at a rental property is caused by a human, not a pet. However, there are unusual circumstances when a pet does cause a bit of mischief. Here are a few examples of times we have paid out claims for pet damage…

• A tenant suddenly abandoned the rental property, leaving many of their belongings in the house… including a pet dog. The dog was left to fend for itself in the property for several days, before it was discovered the house had been deserted. During that time, the dog managed to cause serious damage to the property, including tearing up carpets and damaging blinds and curtains. As the landlord was covered by EBM RentCover, they were able to claim for an array of losses, including pet damage – which we paid out $3,178.  
• A tenant signed a lease agreement, not noting a dog on the lease. The tenant moved into the property in October and a routine inspection was conducted the following May. There was nothing out of the ordinary during the routine inspection, and zero signs of a dog living in the property. However, a little while after, neighbours complained of an odour originating from the unit – that is when the property manager discovered the dog. The tenant, after being confronted, decided to vacate the property leaving it in a poor and contaminated condition. In fact, even after the unit had been cleaned and acid washed, the odour from the unit remained unbearable. The dog urine and faeces had penetrated the fixtures, so many had to be replaced. EBM RentCover engaged the services of a restorer and hygienist and paid out the limit (at the time) of $65,000 to cover malicious damage (which includes pet damage) following the mess left at the property.

NOTE: EBM RentCover now offers up to $70,000 cover for pet damage.

How does an insurer define pet damage?

Again, all insurers are different. However, at EBM RentCover we cover damage to fixed contents and building caused by a tenant's domestic pet kept at the property, including those not named on the lease. This is provided the landlord or agent inspects the home within six months of the commencement of the initial lease, and then at least annually thereafter.

Do all insurers include cover for pets not named on the lease?

No, often the pet must be noted on the lease agreement. Landlords should check their policy wording carefully to determine if pets not named on the lease are covered.

What are the exclusions?

As mentioned above, some policies do not cover pets not named on the lease. In addition, the definition of a pet changes from insurer to insurer. At EBM RentCover, the pet must be domesticated (cats and dogs). And we do not provide cover for vermin, rodents or wildlife. Policyholders should read the Product Disclosure Statement closely to determine it their furry (or not-so-furry) friends are covered.

What are the benefits of allowing pets in properties?

There are several reasons why landlords might consider renting to tenants with pets. In fact, we have compiled a list which can be found here.

Do I have to allow pets in my property?

This is the current tenancy legislation that surrounds pets in rentals (scroll down to find the state your property is in)…

• VIC: On 2 March 2020, new laws came into effect which gave tenants the right to have a pet. Renters who want to have a pet in the property must ask their landlord for permission and fill out a pet request form. Rental providers have 14 days to decide whether to allow the pet and give written consent. Landlords must have a good reason to refuse the renter’s request and must apply to VCAT for an order to refuse permission.
  
  Strata: Standard/default Victorian strata building rules do not prohibit pets or require advance permission for strata owners and residents to keep a pet in a strata building. But the rule can be changed by the strata building to prohibit pets.
   
• NT: On 1 January 2021, changes to the tenancy laws came into effect which gave tenants the ability to keep a pet at their rental premises. In order for this to occur, the tenant must notify the landlord in writing of the intention to keep the pet at the property. Then, if the tenant has heard no objection after 14 days (and if the landlord has not made an application to NTCAT), the tenant is allowed to keep the pet in the rental.
  
  Strata: Pet owners must have permission from strata or body corporate before they are able to bring an animal onto the property.
   
• ACT: Tenants can ask for permission to keep a pet at the property if the signed tenancy agreement requires them to do so. The landlord must apply to ACAT to refuse consent within 14 days of receiving the tenant’s written request to keep a pet. If no application is made to ACAT within this timeframe, then it’s considered that the landlord doesn’t object, and the tenant can keep a pet. Landlords can only refuse consent on very specific grounds and with the approval of ACAT.
  
  Strata: As of 1 November 2020, the default position is to allow pets in strata properties.
   
• QLD: On 1 October 2022, new laws came into effect to make it easier for renters to have a pet. Renters must seek the property owner’s permission to keep a pet, and property owners can only refuse a request on specific grounds. The property owner must respond to a request for a pet in writing within 14 days, or consent is implied. The property owner’s consent may be subject to reasonable conditions.
  
  Strata: Strata residents must have prior strata building approval to bring or keep an animal in the building. Strata bodies are not allowed to have a blanket ban on pets. 
   
• NSW: There is no term in the tenancies legislation that prohibits tenants from keeping a pet, or that requires the tenant to ask their landlord’s consent before keeping a pet. However, many landlords will include a clause restricting pets in the residential tenancy agreement. Landlords can refuse to allow a tenant to keep a pet without providing a reason.
  
  Update: In late 2022, the State Government sought public comment on changing the law to make it easier for tenants to rent with pets. Consultation concluded in December 2022 and, at the time of writing (June 2023), no further progress had been made.
  
  Strata: In August 2021, new regulations relating to keeping of animals and by-laws came into effect for strata properties. Strata schemes may have a by-law about the keeping of animals. A by-law can only prohibit pets where the keeping of an animal would unreasonably interfere or impact on other occupants. Blanket up-front bans on animals are not able to be imposed.
   
• SA: Keeping pets in private rental properties (other than those in a strata or community title scheme) is at the discretion of property owners.
  
  Update: On 18 June 2023, the SA Government announced proposed reforms to the tenancy legislation that would allow renters the right to pet ownership and remove blanket bans on pets. At the time of writing (June 2023), no further progress had been made.
  
  Strata: For strata or community title properties, residents must get the consent of the strata or community corporation to keep any animal at the property.
   
• WA: There is no specific refence to pets in the tenancy legislation and allowing pets is at a landlord’s discretion. Landlords can charge a pet bond (assistance dogs excepted).
  
  Update: In December 2019, the WA Government began a review into reforms to the tenancy legislation. Among the changes was a proposal to allow tenants to keep pets unless it is reasonable for the landlord to refuse. Delayed by COVID-19, the revised legislation is now being drafted. At the time of writing (June 2023), no further progress had been made.
  
  Strata: The keeping of pets is at the discretion of the strata council or body corporate.
   
• TAS: In Tasmania, a tenant can only have a pet if the landlord has agreed or it is in the lease.
  
  Update: In June 2021, a bill was introduced to Parliament that includes requiring reasonable grounds for refusing pets. At the time of writing (June 2023), no further progress had been made.
  
  Strata: A tenant must have the body corporate’s written approval to bring an animal into their home.

Note: There are generally exceptions to the laws in respect to assistance animals such as guide dogs. Landlords and bodies corporate usually cannot prohibit these animals in rental properties or strata complexes. Be sure to check the relevant legislation in your jurisdiction.

Whether the decision to allow pets in a property is yours or not, landlords can be safeguarded should the unexpected happen. The right landlord insurance policy will offer protection if a pet causes damage or loss to an investment property. For more information about this feature, contact the EBM RentCover team today – 1800 661 662.

*While we have taken care to ensure the information above is true and correct at the time of publication, changes in circumstances and legislation after the displayed date may impact the accuracy of this article. If you need us we are here, contact 1800 661 662 if you have any questions.