Victoria’s Strata Commission Debate Enters a New Phase

The decision matters for apartment owners, townhouse communities and strata committees because insurance is often one of the largest recurring costs in a scheme’s budget. Where commissions, referral benefits or related-party arrangements sit behind the placement of cover, owners may struggle to understand whether the recommendation placed before them is the best available option or simply the option that best fits an existing commercial arrangement.

The Victorian review is closely connected to the broader national debate already unfolding in NSW, where a separate inquiry has recommended prohibiting strata managers from accepting commissions and examining the role of intermediaries in the insurance chain. Victoria’s more cautious approach suggests governments are now balancing two competing concerns: reducing conflicted remuneration while avoiding reforms that could reduce access to advice or simply shift costs into less transparent service fees.

For owners corporations, the practical lesson is not to wait for legislation before improving governance. Committees should ask for clear documentation showing the base premium, statutory charges, broker remuneration, manager remuneration and any other benefits attached to the insurance placement. If these details are difficult to obtain, that is a sign the committee may need a more disciplined renewal process.

Committees approaching renewal should use the uncertainty as a reason to compare strata insurance options early, rather than accepting a last-minute renewal proposal. A transparent comparison should consider not only price, but also excesses, exclusions, catastrophe exposure, claims handling capacity, building defects, valuation assumptions and whether the policy reflects the scheme’s actual risk profile.

Professional advice still has an important role, particularly for larger, mixed-use or higher-risk buildings. The key is ensuring any strata insurance brokers involved can explain how they are paid, what markets were approached and why particular insurers declined or offered terms. Disclosure should be specific enough for owners to make an informed decision, not a generic statement buried in meeting papers.

This is an extension of the commission debate already reshaping the strata insurance market. Whether Victoria ultimately follows NSW towards a stronger ban or adopts a disclosure-heavy model, the direction of travel is clear: owners corporations will be expected to demand more evidence, more independence and more accountability from every party involved in arranging cover.