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Push for Strata Insurance Reform Escalates After PICA's Withdrawal Threat

Consumer Advocates Call for Government Intervention in Strata Insurance Practices

Push for Strata Insurance Reform Escalates After PICA's Withdrawal Threat?w=400

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The debate over transparency in strata insurance has intensified following reports that PICA Group, Australia's largest strata management company, threatened to withdraw its membership from the Strata Community Association (SCA) New South Wales.
This move comes as the SCA pushes to phase out commissions on strata insurance, a practice long criticised for creating conflicts of interest between strata managers and property owners.

Consumer advocacy groups, including the Australian Consumers Insurance Lobby (ACIL) and the Owners Corporation Network of Australia (OCN), have called on the New South Wales government to advance reforms aimed at enhancing transparency and accountability within the strata insurance sector. They argue that the current commission-based remuneration model can lead to higher costs for property owners and potential conflicts of interest.

The proposed reforms include transitioning to a fee-for-service model, which would provide clearer visibility of costs and services for property owners. This shift aims to align the interests of strata managers and property owners more closely, ensuring that decisions are made in the best interest of the strata community.

For strata property owners, this development highlights the importance of staying informed about the financial arrangements within their strata schemes. Engaging with strata managers to understand fee structures, advocating for transparent practices, and participating in discussions about potential reforms can help ensure that their interests are adequately represented and protected.

Published:Saturday, 4th Apr 2026
Author: Paige Estritori

Please Note: We do not endorse any specific products or companies. Some content is sourced from third parties, including press releases, and may not be independently verified for accuracy or completeness.

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Knowledgebase
Moral Hazard:
The concept that individuals may take on more risk when they do not bear the full consequences of that risk, often relevant in insurance scenarios.