Hi Dudley,
Let’s see if I can make some sense of all of this for you.
I will deal with each issue as you have mentioned . But before I start I would suggest even for a small scheme you would or should have an Executive Committee and the committee would be in regular contact and instructing your Strata Manager (SM) However I know of schemes that give full authority to their SM and leave the running of the OC with the SM.
STRATA INSURANCE
Firstly it’s compulsory – no option you must have it. The commission you speak of is the only allowed commission that Strata firms can receive. The fact is without this commission many Strata Firms could not survive and if it was taken away you would see management fees rise very sharply. It is normal that a couple of quotes would be sought each year, but it’s not unusal to see the same insurer from year to year. Insurers tend to give bigger discounts if the strata scheme is run well and stays with the insurer. There is nothing wrong in asking the SM if they called quotes.
STRATA PROPERTY VALUATION
It is normal for the strata complex to be valued each year and the valuation is based on establishing the replacement value so that the Strata Insurance is taken out at the right coverage level (Strata Insurance also covers several other insurances not just the buildings). As for the valuation being done by an associated firm that’s up to you and the other owners, I don’t see any issues so long as the cost is competitive.
TRADES MONITOR
Trades Monitor is a company that provides a service in carrying out an audit on the contractors used by your strata scheme in carrying out maintenance and other works, this protects to OC as each contractor is audited regarding the currency of their Trade Licence, Insurance and OH&S. I am of the view that it is money well spent.
CLOSING
Always remember that as a Owner you have the right to ask questions of both the EC and SM, so I would raise your questions with them, it seems all is in order. It’s not simple to understand all the procedures involved in strata so I hope I have been able to make you aware of a few around these issues. Best to you and your strata scheme.