Actually, this appears to be a fairly standard declaration for professional indemity insurance.
The declaration is required before the insurer can offer up insurance and quote a price which can only be done after they get the declaration as the op has stated.
The insurer will use this to cross check the information provided and calculate the risk and come up with a price for the policy or refuse or limit the insurance in some way.
It may also be also used as a waiver if false information is provided and they find out later.
It seems a bit unusual though for individual members to each have to provide a seperate declaration rather than the owners corporation as a whole making the application but this could be due to the different way that this works in other states as a management commitee perhaps?
In comarison, if you take out pi insurance as a business in NSW, normally the directors are listed in the declaration, they don’t fill in separate ones.
The reason the other member may not want to sign is probably because he has either had a claim, intending to clain or he doesn’t want to provide his private information which he is probably not obligated to do as it’s outside the scope odf what is expected and let’s not forget he ain’t getting paid.
The normal insurances required for the strata such as public liability and so on should not be effected by the pi insurance I wouldnt have thought.