A proposed amendment to the NSW Residential Tenancies Act could see tenants granted the right to make “minor or cosmetic” alterations to residential premises, with potential implications for landlord insurance.

The changes, set out in a bill to be considered by the State Parliament in the next few months, provide that a landlord “must not unreasonably withhold consent to an alteration, addition or renovation to the residential premises by the tenant if it is of a minor or cosmetic nature”.

Under the proposed amendments tenants would also be able to apply to a tribunal for an order that a landlord give consent to the installation of a fixture or to a renovation, alteration or addition, or an order that the tenant does not need the landlord’s consent to remove a fixture.

Other key provisions require tenants to remove fixtures installed on their behalf at their own expense unless otherwise agreed.

If enacted, the changes have the potential to generate uncertainty regarding the definition of a “minor or cosmetic” alteration, could be a source of concern among providers of landlord insurance over liability to cover rectification costs, as well as potential damage caused by alterations.

These issues could prompt a rise in landlord insurance premiums to cover these additional risks.