Independent Review of Strata Insurance Practices

On 15 July 2022, a paper titled Independent Review of Strata Insurance Practices, authored by insurance industry expert John Trowbridge and commissioned by the Steadfast Group was released.

This paper is the first in a three-phase series of papers aimed at identifying issues and means to improve understanding and the practical application of strata insurance practices, with the three phases focusing on:

Phase 1: Disclosure

Phase 2: Remuneration

Phase 3: Affordability and availability.

This phase (Phase 1) aims to identify disclosure limitations and recommended ways forward to achieve transparent disclosure for strata property owners and their strata committees.

Some of the report’s findings included that:

     There are a minimum set of requirements (eight financial items) that should be disclosed as part of any strata insurance process

     Industry-wide templates should be used to improve transparency practices

     Strata insurance practices are sometimes poorly understood and in many cases very complex

     Brokers and strata managers can work more closely with strata committees on the timing of insurance and documentation to foster better understanding.

Building on the report’s findings, the report made a series of recommendations. The main recommendations in the paper are:

     Financial disclosures in the form of broker quotations and invoices be prepared by reference to standard templates containing a minimum set of eight items with common definitions.

     Brokers and strata managers arrange to ensure timely transmission of quotations and invoices to the strata committee during the annual renewal process.

     Financial disclosures be accompanied by a statement of the scope of services by the strata manager and broker and a full explanation of commercial relationships between broker and strata manager (noting that some are beneficial to all parties, in the interests of the owners, and others raise questions).

     SCA and the National Insurance Brokers Association (NIBA) consider the recommendations in detail and give effect to decisions they take on a self-regulatory basis by establishing guidance notes or practice standards for their respective members.

This work by John Trowbridge builds on the important work commissioned by SCA and undertaken by Deakin University’s Dr Nicole Johnston in 2021 – A data driven holistic understanding of strata insurance.

That report explored strata manager roles in relation to strata insurance, affordability and availability of products and remuneration models, where some of the main findings in relation to disclosure were that:

     Strata manager duties: There are at least 47 strata insurance services that are regularly provided by strata managers to their OC / BC clients. These services have been categorised under seven broad categories including: quotation, procurement, placement and renewal; insurance valuation; insurance claims and insurance recording.

     Strata manager value: There are three value pillars identified that highlight the role of strata managers in the delivery of insurance services. First, strata managers are agents of the OC / BC and act in their best interests.

Second, strata managers are custodians of records critical to the insurance process. Third, strata managers are a knowledge-bank of information such as related legislation, regulation and the building’s particular characteristics related to strata insurance that coupled with their actions in the best interests of the OC / BC underlines their value in the insurance process.

     Strata insurance licensing and regulation: There are various registration and licensing requirements imposed on some of the providers in the supply chain. Brokers, insurers and underwriters must hold an Australian Financial Services Licence (in Australia) or Financial Product Market Licence (in New Zealand). Four jurisdictions (ACT, NSW, NT, Vic) require either registration or licensing when providing strata management services or carrying on a strata management business.

If you wish to respond to any aspects of the paper, please visit John’s website or email John Trowbridge at

If you wish to discuss the paper with the SCA Policy and Advocacy team, please contact Shaun Brockman,

This project has been commissioned by Steadfast Group but the views, findings and recommendations in the paper are those of the author.

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