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Topic
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NSW strata managers are to stop taking commissions for arranging strata insurance – but with what, if anything, will they replace the lost revenue?
[See the full post at: What does the insurance commission ban mean?]
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Lots of money in the commission game – our insurance broker in NSW pays commission to the strata manager and keeps a share for himself. Wonder what the insurance companies think about all this ?
The strata manager says this way he can charge us a lower strata management fee (to his credit he is quite transparent about the amounts).
So suppose now we will be just charged a flat fee of $2,500 to ‘manage’ the insurance renewal.
Our building, up to 2 years ago, used to pay commissions to the strata manager
We have a very good and responsible insurance broker, who also was not comfortable with paying a commission. We negotiated a brokerage fee with the broker that excluded any commission to the strata manager.
As we all know, commissions are used to disguise low strata management fees. Discussion between the committee and the strata manager ensued (as we were otherwise satisfied with the services we were getting) and in return for the strata manager not taking any commissions they got an uplift in their management fee at the last renewal.
I think all around this was a very satisfactory result (the strata manager is not a member of SCA BTW)
I am also associated with two other building (being properties owned by my daughters) and these strata managers do not take any commissions , and have never done so.
As a contrast, one of these buildings was managed by a large strata management group (whom I cannot name but are well known) and of course they were taking commissions. That was until their contract was not renewed.
Many will try to use preferred facilities maintenance providers – plumbing, grounds, caretaking, electrical, painter, repairs, fire safety – that they either own or have an interest in.