#18686
Jimmy-T
Keymaster
Chat-starter

    If I may play devil’s advocate here – and I don’t deny any of the problems listed by the OCN exist – it seems to me that the problem isn’t commissions per se, but a lack of accountability and transparency and responsibility by SOME strata managers who take the money and do nothing for their clients.

    Case study 1 would not have been a problem if there was a clear chain of statutory responsibility with insurance claims.  So, along with accepting a commission, the strata manager should be obliged to accept that they will manage claims and give advice accordingly.

    Case study 2 is a clear case of an SM either being too lazy or possibly even being corrupt.  If an SM is taking commissions, they should present a minimum of three quotes so that the owners can make an informed choice.  This particular case seems to have less to do with commissions than it is related to bad management.

    Case study 3 relates to an extreme event – the Queensland floods – and a windfall financial bonus to strata managers.  A good strata manager in Queensland would have been paying some of their excess commission back to the owners.  Again, this has as much to so with customer service and relations as it has to do with commissions.

    Commissions on insurance premiums are an anachronism, open to gross exploitation by the less scrupulous strata managers and a fairly blunt instrument when it comes to reducing the costs of assessments and marketing for insurance providers.  However, so far I don’t hear anyone suggesting how you can remove them completely without smaller strata management firms going to the wall.

    Any thoughts? Anyone?  Or do we ban commissions completely and let the card fall as they may?

    FYI:  When the question of commissions came up in my building a few years ago – to considerable outrage from owners – our new strata manager found us cheaper insurance with better cover and still got the commission. 

    The opinions offered in these Forum posts and replies are not intended to be taken as legal advice. Readers with serious issues should consult experienced strata lawyers.