An investigation revealed that Steadfast recommended higher-cost policies from its own subsidiaries while withholding cheaper offers from competing underwriters. This practice raises significant questions about transparency and the potential conflicts of interest inherent in the current commission-based remuneration model.
ACCC Chair Gina Cass-Gottlieb criticized these undisclosed commissions, stating that they contribute to rising insurance premiums and create conflicts of interest. She emphasized that the receipt of hidden payments and commissions misleads consumers and called for a full ban on such payments in the strata insurance sector.
In response to these allegations, Steadfast's CEO, Robert Kelly, acknowledged that many apartment owners were unaware of these deals, admitting a gap in their understanding. This admission underscores the need for greater transparency and accountability within the industry.
For strata property owners and managers, this development serves as a crucial reminder to diligently review insurance policies and ensure that all available options are considered. Engaging with independent insurance brokers and seeking transparent advice can help mitigate the risk of being subjected to potentially misleading practices.
As regulatory bodies continue to investigate and propose reforms, it is essential for all stakeholders to stay informed and advocate for practices that prioritize consumer interests and promote a fair, transparent insurance market.
