The Earl of Kinnoull:

Moved by The Earl of Kinnoull

127: Clause 12, page 20, leave out lines 28 to 31Member’s explanatory statementThis amendment seeks to remove a requirement on tenants to have pet damage insurance.

My Lords, in moving Amendment 127, I shall speak also to Amendments 128, 129 and 130. I remind the Committee of some different interests this time, in that I am a director of Alpha Insurance Analysts, which operates around £1 billion of premiums at Lloyd’s, and I have share ownership in Hiscox Group.

The thrust of everything in this bit of the Bill is all about pets. I am very keen on pets in general being in houses. As I pointed out, pets are usually allowed in my Scottish interest. When I looked at the insurance provisions, I was looking very carefully with a professional eye, and I wanted to try to tweak four separate areas that all needed something. First, there was the proposition that the tenant would buy insurance, then that would be all right. Secondly, there was the proposition that the landlord could buy insurance and bill that back to the tenant. Thirdly, there was the possibility of aligning the England and Wales law with what happens in Scotland, where, of course, I have a lot of experience. Fourthly, there was the knotty issue of the definition of “premium”, over which I have had many arguments in many jurisdictions over many years—and I apologise in advance for disagreeing with counsel on that.

Amendment 127 is on the first of those things in my list. There is no market today for insurance where a tenant goes out privately to buy insurance. There certainly will not have been a single cent of premium written in the UK market up to 31 December last year nor in any of the continental European non-life insurance markets, with which I am extremely familiar. One or two products have appeared on the market that provide some sort of partial cover—and I shall try to describe some of that.

I am very grateful, in saying this, to the department and the people supporting the Minister, because we have had a funny tour around this issue. We even had one exciting moment when an insurer that I had never heard of, which turned out to be an insurance company based in Anguilla, of recent formation, was keen to sell insurance to British people, although of course there would have been no protection under the Financial Services Compensation Scheme or from the insurance ombudsman, let alone all the tax and regulatory problems with an Anguilla insurer trying to settle a claim in the UK.

Leaving aside that exciting insurer, one or two insurers have come along, but they want to insure only against accidental damage, however it is dressed up. When talking about insurers, it is important to understand the difference between the insurance carrier, which takes the bet, and the insurance intermediary, which puts exciting things on the web to try to entice you. These are all insurance intermediaries, and there is only one carrier that is identified at the moment, which is under half the size of the legal minimum for an insurance carrier, if you are forming a new one, and does not appear at all on any of the lists of allowed insurers that major brokers have. It is exceptionally small and very weak.

The problem with the cover of the three policies that appear online at the moment is that they are limited to accidental damage. In one of them, accidental damage is defined as

“unexpected damage which happens suddenly and has not been caused on purpose or inevitably”.

I immediate think that that does not sound like very good cover. The other one goes a lot further. It says that the policy is

“not for damage caused by everyday wear and tear. For example, if a dog scratches at your door every day, this is not covered, while if a pet pulls down curtains that causes damage to a wall this would be covered”.

Of course, that is a vanishingly small percentage of the loss costs likely to be caused by a pet. Most of the losses from pets will be to do with chewing or infestations—I look at my noble friend Lord Trees in the hope that he will tell us all a bit more about infestations later on.

The difficulty of trying to legislate so that a landlord can say to someone, “You can have a pet as long as you buy an insurance policy”, and there being no actual policy of insurance that exists, or no reasonable one, is that it is what is sometimes called an Italian torpedo—a legal trick whereby you started a case in a different jurisdiction to slow everything down, and the initial case never gets decided. It would mean that the landlord could ask the tenant to find insurance that he knew did not exist and the pet would never be allowed into the property. That is not the intention of this Bill, so it would be quite wrong to let this option go forward. That is why Amendment 127 seeks to get rid of that option. It is not a probing amendment—it is a real amendment.

I turn to Amendment 129 next, only because the amendments have appeared a bit out of order. It is a probing amendment, and it covers the second issue on insurance, which is whether the landlord could buy insurance. Here I am much more hopeful. I should point out that this type of insurance also does not exist at the moment, but I have spoken to the underwriting managers of at least two of the big players in the UK markets and left those conversations feeling that it was quite possible that this type of insurance could come into existence—in fact, in reviewing the internet, there is some evidence that it might. It will start with this accidental damage problem, so it is not a complete cover; therefore, landlords might not choose to exercise that option because it does not really exist.

Therefore, I feel it is unfair to ask landlords to go to the market to buy insurance, and they might not want to. The insurance would therefore be a terrible situation, where a landlord is being asked about a pet and the tenant cannot buy the insurance because it does not exist—at least not in a reasonable form—and nor can the landlord because it is at a very early stage. But I felt that should stay on the statute book because I believe that something helpful might come along. I believe also that the type of insurance that will come along will be a small layer just above the deposit that people pay anyway; at the moment, it is a five-week deposit.

Therefore, Amendment 129 is a set of suggestions to increase the understanding of that landlord option, and about how much insurance a landlord might reasonably ask a tenant to pay for, because the landlord’s cost of insurance is billed back to the tenant. If the landlord bought £5 million worth of cover, it would cost a lot of money, and that would obviously not be right, which is why I have put the six months in there.

Moving on to Amendment 128, which is also a probing amendment, in Scotland, of course, this is coped with—in my direct experience—simply by having a larger deposit. The deposit in Scotland is two months. I am afraid I have rounded two months down, which is why I have increased the deposit to eight weeks. But this would provide a level of cover. In Scotland, it drives the way in which landlords present the properties. So, you present properties with hard floors so you have much less of a problem with things such as infestations, and you present properties knowing that you are probably going to have to replace bits of wood lower down on the wall that might have been chewed. Therefore there is in Scotland an operational market that has worked on this basis for some time, and I felt that was a reasonable introduction of a separate idea which would allow for the landlord to have some comfort when he was allowing a pet into the house.

I am going to finish by briefly talking about Amendment 130, which seeks to define premiums. As I said, there are an enormous number of fights, or there have been in the past, over what the word “premium” means in English law. It is something that insurers, reinsurers and all sorts of people worry about the whole time, therefore it is best always to be absolutely clear what you mean. It is clear in my mind that in this Bill we mean “premium plus IPT”—that is, that the amount of money that can be reclaimed when the landlord buys the insurance is the insurance premium and the IPT as well. It is important to be clear about that, otherwise inevitably there will be questions put of tribunals and so on that are trying to worry about this sort of thing. They will not have the scars on my back that I have after 30 years of fiddling around in the insurance markets. So it should be made crystal clear, and that was the intention behind Amendment 130. I beg to move.

My Lords, when the Renters (Reform) Bill was originally proposed, Battersea asked landlords what policies or incentives would make them more likely to consider offering pet-friendly properties—that is an important point to bear in mind—and out of all the different policies and incentives, the two most popular were requiring tenants to hold insurance to cover any damage, or changing the Tenant Fees Act to allow the landlord to charge for a deep clean and fumigation at the end of the tenancy. I acknowledge that there are concerns regarding availability of insurance to cover pet damage in line with the requirements currently set out in the Bill. However, having talked to those with expertise in the sector, I believe the insurance market will adapt to new legislation, as it has in the past with cyberinsurance under the Data Protection Act 2018 and professional indemnity insurance for cladding remediation under the Building Safety Act 2022. I think there is already evidence of insurers responding to market demand, with the letting insurance providers Paymentshield and Addept Insurance updating their tenants’ content policies to include pet damage cover. I am aware of other providers that are in the process of—

One of the things I read was that Paymentshield is offering accidental damage only; I read out the definition of accidental damage and that is not really any cover at all. I am sorry; I do not know whether the noble Lord was talking to insurance underwriters or brokers, but I can tell him that the underwriting community in the insurance world is absolutely solid on this.

My Lords, my general point was that I believe the market would adapt in time, because that is the purpose of legislation—to push that market on. I know there are other insurers that are looking at pet damage insurance products to bring to the marketplace. We will have to see if it happens, but I very much hope that it would. I understand the fears from landlords that pets may damage their properties, but I also do not believe that pet deposits are the solution to this area, because they are unevenly applied and unaffordable to many.

Finally, I just want to make the general point that research has shown that fears around pet damage are often largely unfounded. Again, research that was commissioned by Battersea with the University of Huddersfield showed that more than three out of four landlords did not encounter any damage caused by pets in their rental properties. So there is very low risk, and, alongside evidence showing that pet owners tend to stay longer in their properties, this demonstrates that renting to pet owners can be financially beneficial to landlords in the long run.

I put to the noble Lord this point about the Italian torpedo. I hope he will accept that there is currently no reasonable insurance solution available for a tenant—there is none. So, if a landlord says, “I need you to go out and buy a tenants’ insurance policy”, thinking, sneakily, that as one does not exist, the tenant will look forever and will never be allowed a pet, would that be an acceptable solution for the noble Lord?

I go back to the point that the market may not exist at the moment but the legislation is designed to push this market along. I very much hope that by the time the Bill becomes law, that market will have adapted.

But if the market does not come into being—I made the point about insurance not being available for inevitabilities—we will have created through the Bill a route for landlords to quite simply prevent tenants having pets.

That is probably a bridge we ought to cross when we come to it.

My Lords, the noble Lord, Lord Black, quoted from the University of Huddersfield’s excellent research, The Financial Impact of Pet Ownership in Rental Properties, which I have read in detail. One of the most surprising things is that there is more non-pet-related damage to properties from non-pet owners, which averaged at £215, than there is pet-related damage from pet owners. But perhaps the more relevant thing to this particular debate is that when there was damage: the tenant’s deposit fully covered the cost 38% of the time; the repair costs exceeded the deposit and the tenant covered the additional costs 18% of the time; and the repair costs exceeded the deposit and were covered by insurance 13% of the time—which is surprising given what the noble Earl, Lord Kinnoull, told us. So, more than 60% of the time, there was no problem at all. Only in a very small percentage of the time did the landlord find themselves out of pocket. The overall findings from this study were that it is a much-exaggerated fear rather than an actual problem.

My Lords, I support Amendments 127, 128 and 129 in the name of my noble friend Lord Kinnoull and others. With regard to pets, the main purpose of the Bill is to make it more likely that landlords will accept tenants with pets. That is its purpose, surely, and it is an objective that I fully support, as a veterinarian, particularly for elderly and lonely people, as well as others. The benefits of pet ownership are very well known, with a strong evidence basis. Amendments 127, 128 and 129 would ensure that the purpose of the Bill with regard to pets is not confounded by unintended consequences. The current reality—and we cannot ignore realities, as the noble Lord, Lord Black, does—is that 40% of landlords are currently unwilling to accept tenants with pets.

Another survey that the noble Lord, Lord Black, quoted showed that 27% of landlords who do accept tenants with pets—that is, one-quarter—have experienced problems. So, in order to boost the market for pet-friendly rentals, it is important that landlords are assured that, were there to be negative effects due to pets, there is adequate legal recompense. The Bill recognises this, and the solution it proposes is that the landlord can require a tenant to provide appropriate insurance. But the problem, clearly articulated by my noble friend Lord Kinnoull, who is, of course, an expert in insurance, is that it appears extremely unlikely that there will be a product on the market which a tenant could buy to insure against the problem—relatively unlikely, perhaps —of damage. If that were the case, as my noble friend started to explain, a landlord could debar a tenant by the simple act of requiring that they provide insurance to cover pet damage, their failure to find which would legitimately allow a landlord to bar them access with a pet to rental accommodation. So it would conflict with the objective of the Bill.

Amendment 127 would remove that possibility. Instead, Amendment 128 would allow an increased deposit arrangement to enable landlords to permit pets, confident in the knowledge that, in the unlikely event of damage, it will be covered by the deposit. Amendments 128 and 129 would ensure that the level of recompense is likely to adequately cover relatively costly measures, such as deep cleaning to remove allergens, referred to earlier, or the elimination of infestation with fleas, which can be a significant problem if it occurs and expensive to remove. I would love to say more about fleas—they are remarkable creatures that can jump amazing distances compared to their size—but I am aware of the constraints on repeating Second Reading speeches, so I will not. I also make the point that a deposit is likely to be a fairer and more acceptable arrangement to a tenant than paying for an insurance policy, because obviously there is no cost unless there has been a problem.

To conclude on these three amendments, I strongly support them and I think they would make it more likely that landlords could be persuaded to offer their property for rent to tenants with a pet than any alternative. I shall just make an additional point that I did raise at Second Reading but which is pertinent to this issue and has wider implications, and that is on assistance dogs. We know that having a pet is very valuable to many people’s physical and mental health, but the case of assistance dogs is very special. These are incredibly valuable animals that can alert to medical emergencies of all sorts, as well as providing physical support for disabled people, hearing support and other things. Yet assistance dogs are not actually officially recognised—there is no list or register of them—and I understand that people with assistance dogs sometimes have problems finding rental accommodation. I raised this at Second Reading, but I hope the noble Baroness will excuse me mentioning it again. She said she would discuss it with officials, and I ask her to consider that again. I strongly support Amendments 127, 128 and 129.

I am delighted to have added my name to Amendments 127, 129 and 130 in this group. I thank my noble friend Lord Kinnoull for leading on this section with regards to pet insurance and respect his deep knowledge of the insurance market. Amendments 127 and 128 seek to provide an alternative to the pet insurance route for protecting landlords from pet damage, as there is still uncertainty at present as to whether the insurance market will provide a policy that is fit for purpose, as described in the Bill. Amendment 128 would allow for an additional three weeks of deposit to be paid and held. I listened to the Government saying that finding a deposit can be challenging for tenants, especially the low paid. Therefore, these insurance policies, if they can be developed, could be an accessible and appropriate product for tenants.

For some tenants and landlords, the option of paying a three-week deposit could be an alternative, as both parties would know where they stand from the beginning of the tenancy, or when a pet moves into a property. There are further advantages, as the tenant would get their money back if no repairs were required at the end of the tenancy, thereby rewarding tenants for looking after the property. As my noble friend Lord Trees pointed out a minute ago, if tenants pay for an insurance product, they are not rewarded for being good tenants, and the premium paid benefits neither tenant nor landlord. The deposit scheme is allowed in Scotland, so there is some real-life data that can be drawn on to see whether it works for both tenants and landlords. From my noble friend Lord Kinnoull’s experience, it appears to be working.

The deposit option gives flexibility for landlords and tenants in choosing the most appropriate protection for themselves and their circumstances in covering the possible extra costs of housing a pet in a rental property. This is a challenging issue for some landlords and very few currently accept pets. That is why Clause 12 is welcome: it will increase the number of landlords accepting pets—surely giving two methods by which they can protect themselves can only ease the fear and reluctance in accepting a pet.

Amendments 129 and 130, which I also support, would bring clarity on the detail to be included in the proposed insurance products and would clear up some of the confusion with these amendments. Therefore, I hope the Government will listen to these speeches today and consider adding a bit more flexibility to the Bill by accepting these amendments on Report.

My Lords, I support Amendment 128 and declare my interests as a landlord and a former PRS tenant. I support the amendment of the noble Earl, Lord Kinnoull, on pet deposits. First, I want to state that I am a dog lover and had dogs as pets in my youth. I was, however, horrified by the description by the noble Lord, Lord Trees, at Second Reading of the potential cost and sustained effort required to deal with flea infestation, and there is other damage that cats and dogs in particular can cause. Carpets, for example, may need to be wholly replaced after some pet tenancies, as I have experienced at considerable additional cost, which was not met by the deposit. As your Lordships have heard, insurance products are currently non-existent or very unsatisfactory, so it makes sense, in my view, to introduce a pet deposit scheme which would make the whole process a lot simpler.

The main point I wish to make is that where a lease bans pets, particularly dogs, this should be respected. As we also heard earlier, not all properties are suitable for dogs, especially large dogs. There has been an exponential rise in dog attacks in the country, especially since the pandemic. In total, there were 31,920 dog attacks in England and Wales over the last year alone— 87 a day. Since 2022, 31 people have been killed by dogs, and there were almost 11,000 hospital admissions for dog bites in England between 2023 and 2024. These figures are truly horrific and are growing. I do not claim to be an expert on this rise, but many have put it down to the surge in dog ownership since the pandemic, poor dog training and an inability of inexperienced owners to control their powerful dogs.

If you had been the victim of a dog attack, you would understand why some seek protection in their home environment, especially blocks of flats. My wife was attacked by a dog in our open gardens. Although dogs are banned under the lease, we made an exception to allow a family with a dog. At the time, my wife was wearing a back brace, having recently fractured her spine. I placed myself between the dog and my wife, while the neighbour took five minutes to come outside and struggled to restrain the aggressive dog. Incidentally, it was not a banned breed.

Those five minutes felt like a long time. Although our neighbour was red-faced and apologetic, it was a serious and frightening incident. For months afterwards, my wife had flashbacks, as it could have been a life-altering experience, like the ones you read about in the newspaper or see on television. In conclusion, where dogs are banned under leases, those leases should be upheld, and where dogs are allowed with discretion, that should also be upheld.

My Lords, the matter of pet damage insurance is an extremely important one, as it directly addresses the responsibility of the tenant in conjunction with the increased rights that they may be granted under the Bill.

In all our discussions on this question, we have acknowledged that allowing pets into rented properties brings with it a series of risks. There are risks to health in questions around allergies and dangerous animals, risks of damage to the property and risks to the well-being of neighbours and other tenants.

Given this, we believe it is reasonable to grant the landlord the capacity to require the tenant wishing to bring a pet into their property to have pet damage insurance. I have listened very carefully to the noble Earl, Lord Kinnoull, and I thank him for all the work he has done on this—which I think is really important work—but I am disappointed that there does not yet seem to be a product in the market for this.

However, we have to continue down the insurance route as well as down the route of having deposits. It is important, as is in my amendments, that before this section of the Bill comes into effect, there is a final decision from the Secretary of State on an insurance product that is available. If that is not going to come forward, we will have to relook at the issues that have been brought up by the noble Earl, Lord Kinnoull, in Amendments 127 and 128, which, as we have heard, provide an alternative avenue for redress should any damage be caused. This is a flexible addition to the Bill, and discretion is going to be important, but it is important to give people the option here, whether it be through a deposit or through an insurance product which is on the market in the future.

There is concern over the deposit, because it is there for very specific reasons, and when you add a further reason—damage by pets—the amount of deposit may have to be looked at again. The noble Lord opposite brings up the idea of a pet deposit along with the deposit. The principle behind this is that when you have a right to have a pet, you also have responsibilities for that pet. It is correct that landlords should be permitted the ability to claim redress when their properties are damaged, and tenants should be responsible when choosing to have pets.

It is important that we make sure that there is some form of redress for any damage caused, if the landlord wishes. Some landlords will welcome pets without any further insurance or deposit, but where the landlord wishes it, there must be some way for the tenant to have some form of redress at the beginning of the tenancy, in case there is any issue with their pet’s damage or anything else concerning that pet.

I thank the noble Earl, Lord Kinnoull, and the noble Baroness, Lady Scott, for their amendments relating to pet insurance and deposits. The noble Lords, Lord Black, Lord Trees, Lord de Clifford and Lord Truscott, and the noble Baroness, Lady Miller, have all contributed to the debate.

Turning first to the amendments tabled by the noble Earl, Lord Kinnoull, I thank the noble Earl very much for his constructive engagement with me and my officials in the department in recent months. The benefit of the noble Earl’s expertise in this area has been very valuable and very much appreciated, so I am grateful to him.

Amendment 127 seeks to remove the requirement for tenants to obtain pet damage insurance. While I completely understand the concerns behind the amendment, respectfully, I disagree with its approach. One of the key barriers to renting with pets is landlords’ concerns over potential property damage, as the noble Lord, Lord Trees, outlined. Requiring tenants to have pet damage insurance provides landlords with the reassurance they need and helps foster a more positive attitude towards pet ownership in rental properties—that is the balance between rights and responsibilities that the noble Baroness, Lady Scott, mentioned. Removing this requirement risks undermining the balance of ensuring that tenants have a fair opportunity to rent with pets, while also protecting landlords from unnecessary financial risk.

It is also important to note that we are seeing some signs that insurance products designed specifically for pet-related damage are emerging in response to the Bill—not just from Anguilla, as I think the noble Earl, Lord Kinnoull, said. As the noble Lord, Lord Black, said, these products will develop, meaning that tenants should have viable options available. This requirement is therefore both reasonable and practical, ensuring responsible pet ownership without placing an undue burden on either tenants or landlords. I emphasise in response to the noble Earl, Lord Kinnoull—

I will just raise one very simple point, which I thought the Minister was going to deal with. I declare my interests as a Suffolk farmer with houses to let. I am unclear, not being a lawyer: in terms of the liability of a tenant whose premises, or the premises which they occupy, are damaged during a tenancy, is there a distinction between the liability for something that they have done and for something that a pet has done? If there is not a distinction, then presumably the landlord does not have to worry too much about how the damage was done. All that is at stake is what the damage is and what it is going to cost to remedy it.

I thank the noble Lord, Lord Marlesford. The distinction in this case is just trying to encourage landlords who have previously been fairly resistant to tenants keeping pets that they are able to give that concession to pet owners.

In response to the noble Earl, Lord Kinnoull, I emphasise that we continue to engage with the insurance industry, and we remain open to further information about the market and views on how it might develop. I apologise that the noble Lord, Lord Trees, has not yet had a written response to his query about assistance dogs. I will follow that up and get a response for him.

In terms of the comments made by the noble Lord, Lord Truscott, I want to clarify a point I made in my previous speech. Landlords cannot withdraw their consent to keep a pet in case of anti-social behaviour. However, there are other steps they can take. Landlords can seek to evict anti-social tenants for a broad range of anti-social behaviours under ground 14, which could include behaviour related to noisy, disruptive or aggressive pets.

Landlords can also contact their local council’s anti-social behaviour team and the police if behaviour persists, which can culminate in anti-social behaviour injunctions being granted by the courts. In that instance, that could then ban the tenant in question from keeping a pet. The incident that the noble Lord, Lord Truscott, described was really frightening, and I understand why he would have concerns about that. I hope the action I have described helps to respond to his points.

Amendment 128, also tabled by the noble Earl, Lord Kinnoull, seeks to introduce an additional pet damage deposit. While I recognise the additional security this could provide to landlords, I have to resist his amendment for two key reasons. First, it would place a financial burden on tenants, particularly those on lower incomes who already struggle to raise a standard tenancy deposit. Adding another upfront cost would make securing a home harder, disproportionately impacting those in financial difficulty. Secondly, it could create unnecessary administrative complexity for deposit protection schemes, increasing costs and making the system harder to navigate for both landlords and tenants. The noble Baroness, Lady Miller, pointed out that, in the evidence of the University of Huddersfield’s research, the incidence of pet damage is relatively low. We need to think about that in this case as well. The Bill strikes the right balance by allowing tenants to obtain pet damage insurance instead, providing landlords with reassurance while avoiding those potentially very large upfront costs.

Amendment 129 seeks to increase security for landlords against pet damage. While I understand the intention behind it, I have to resist this amendment, as, first, it would make it more difficult for insurers to develop suitable pet damage insurance products. By imposing rigid requirements, we risk limiting the flexibility insurers need to design affordable and effective policies. Overprescribing criteria could, for example, stifle innovation and reduce the availability of products for tenants. It could also place an additional financial burden on tenants. If insurance providers struggle to develop appropriate products, the cost of obtaining such insurance may increase, making it harder instead of easier for tenants, particularly those on lower incomes, to meet the requirements.

Amendment 130 seeks to clarify that in this clause, the term “premium” includes “insurance premium taxes.” I understand the noble Earl’s concern about this, but the amendment is unnecessary, as, first, “premium”—and he knows far more about the insurance industry than I do—is widely understood within the insurance industry and related contractual contexts to encompass all statutory charges, including insurance premium taxes. The existing wording already provides sufficient clarity for insurers and stakeholders, without the need for further elaboration. Secondly, inserting this clarification may introduce unnecessary complexity. It risks creating potential ambiguities in the calculation and application of premiums, thereby complicating administration without delivering any substantive benefit. For these reasons, I ask the noble Earl not to press that amendment.

The two amendments tabled by the noble Baroness, Lady Scott, would require the Secretary of State to consult with insurers before Clause 13 comes into effect. Amendment 284 aims to ensure that insurance products which cover the risk of pet damage are available for landlords who rent to pet owners. We recognise that one of the key concerns for landlords when considering tenants with pets is the potential for damage that may exceed the tenant’s deposit. However, while there are currently limited insurance options specifically covering the risk of pet damage, this is because landlords have discretion over allowing pets and cannot charge tenants for insurance under the provisions of the Tenant Fees Act 2019, meaning there has been little demand for such products. By establishing a framework that encourages the development of this market, we believe the Bill will drive the necessary adaptations in the insurance industry.

As I have already mentioned, my department is engaged in discussions with the insurance industry, and there are some signs that new products are in development in anticipation of the Bill’s passage. We remain open to further discussion with those who know these markets well. For these reasons, we do not support the amendment. I understand how well-intentioned it is, but it would create an unnecessary delay in enabling landlords to require tenants to obtain pet damage insurance, ultimately slowing one of the Bill’s key objectives, which is to ensure that pet ownership is no longer a barrier to renting.

I am a little bit confused as to where we go on this. We are hearing that there is no product at the moment, and there are differing views as to whether there will be a product. The Government are not interested in looking at extra deposits, and I understand the reasoning for that. But if we do not have extra deposits and there is no product, where do we go with this? When does this come into effect if there is no protection for the landlord in the future? I am just confused about the timescale. How long are the Government going to wait for a product to be available?

I understand those concerns. As I have already mentioned, the department is talking to insurers all the time. We are looking at the messages from them that they are developing new products in anticipation of the Bill going through, and we will keep monitoring that during the passage of the Bill. We do not want to create a delay in one of the Bill’s key objectives, which is facilitating pet ownership. We do not want to put a block or barrier in the way of that, but we understand that we need to keep this dialogue going with the insurance industry to see where we are as the Bill progresses.

Amendment 285 seeks to ensure that tenants have access to specific insurance products to cover pet-related damage before landlords can require such coverage. This is a similar point: the amendment would similarly create an unnecessary delay in giving landlords the confidence to rent to tenants with pets. The insurance options tailored specifically for pet damage exist in limited numbers at the moment. That is because landlords have had the discretion to refuse pets, so they have used that as a way of getting around the insurance issue, and it has led to low demand for such products. We believe that the Bill will change that by providing tenants with a fairer opportunity to rent with pets and giving landlords the reassurance they need. We do not believe that a mandatory delay should be made law, as we hope those new products are coming forward with the Bill.

If Clause 13 is postponed, tenants’ struggle to secure homes just because they have a pet will continue. Once the law is in place and landlords begin accepting more tenants with pets, we think the insurance market will adapt to meet the demand, and delaying Clause 13 would only prolong the struggles of responsible pet owners. Given these reasons, I hope the noble Baroness, Lady Scott, will consider not pressing these amendments. We will continue to monitor this situation and carry on our dialogue with the insurance industry.

I am sorry to ask the Minister further questions, but is the Minister saying that landlords will be required to take pets without insurance or any further deposits if there is no product available? If that is the case and a product comes in six months to a year later, will the Bill then allow landlords to ensure that tenants get that insurance product? I am not quite sure how that will work.

We will be amending the Tenant Fees Act so that landlords will be able to require the tenant to obtain insurance to cover the risk of property damage caused by a pet. Landlords will be able to require tenants to have that insurance.

The Minister has again referred to my point that we need to change the Tenant Fees Act. Is she saying there is in law a difference in liability for damage done to a rental property by the tenant or their pet? We know that, if they get struck by lightning, it is not their fault, but do they not have a liability for any damage done as a result of their tenancy anyway? In which case, why does any of this matter?

I have already answered the noble Lord’s question: the idea of this specific pet insurance is to encourage landlords to accept tenants with pets. That is what the clause is there to do: to try to incentivise and encourage landlords to accept pets as part of the tenancy.

My Lords, it has been a very interesting debate. I thank those who have contributed to it all round, and I will try to mention everyone. I thought I should start by answering the question of the noble Lord, Lord Marlesford, about whether there is a difference in the insurance policy between a pet and a human being. The answer is yes, because the provisions of a standard insurance policy in the UK would present two problems for the pet. The first is a total exclusion for infestation and insects—so the sort of problems the noble Lord, Lord Trees, was talking about would be taken out straight away. Secondly, there is usually a heavy exclusion for gradually operating causes, so that would take out chewing and other things pets might do. For centuries, or at least a century and a bit, there have been policies that are aware of pet damage issues. It is not just a landlord and tenant issue; it is a first-party issue that someone might start claiming for a dog chewing a Sheraton chair. Is that a thing you can claim for on insurance—yes or no? The answer has always been no.

This is the core of the problem, which I will finish on. I did not have the good grace to speak to Amendments 284 and 285, but they are in fact good ways of getting at the very problem I have been describing. I am not sure that I have been clear enough; it is not a question of the market eventually creating something, because it is not insurance if it is inevitable. The difficulty of “first dollar in” protection for a dog chewing something is that it is inevitable that there will be a loss. It is not something that any proper underwriting manager will ever say yes to. Lots of brokers will be very interested in saying yes, because they will see premium volumes and commissions to be earned as well, but underwriting managers will not, and I am therefore extremely negative on the prospects of there ever being a comprehensive policy for a tenant to insure against their pet damaging a flat. That is why I have been concentrating on trying to find other ways of doing this—that are going to be the enabler, which I want, of pets coming into flats.

On Amendment 130, what the Minister has just said is very helpful, in that that can at least be referred to. Although people in the insurance market will carry on knocking spots off each other about the definition of “premium”, the Minister’s helpful words at the Dispatch Box will settle that issue, and we can leave Amendment 130 to one side.

Amendment 129 tries to add something currently missing from the Bill, which is a better definition of what the landlord is able to buy and give the bill to the tenant for. It seems that, at the moment, the landlord could buy £5 million-worth of cover and ask the tenant to pay for it, which would be very expensive. There is more to be discussed on that, and I hope the Minister will agree to meet with me to carry on going through these various insurance issues.

On what the Minister said about the complexities of administering an eight-week deposit versus a five-week one, the great thing about having Scotland next door to us is that we can look over the border and see how complex that has proved to be. In fact, it is perfectly easy to handle. All the various agents who are active in Scotland—the big ones, anyway—are also active in England. I assume that they already have the systems to manage this. I do not feel that the deposit system, which is so successful in Scotland, could not be applied and be successful in England and Wales.

Finishing on Amendment 127, my advice to the House is that we will not get there by having this type of insurance. It would be very unfortunate if this went on to the statute book and it was possible for a landlord to use what I have described as an Italian torpedo approach to prevent people who want to have a pet in their home from doing so, simply by asking for the impossible. Therefore, I look forward to engaging with the Minister and her excellent team again, in the hope that we can find a way forward.

In the absence of anything else, I beg leave to withdraw the amendment.

Amendment 127 withdrawn.

Amendments 128 to 132 not moved.

Clause 12 agreed.

Clause 13 agreed.