Navigating strata insurance can be complex for anyone, but understanding best practices in insurance disclosure can simplify the process and contribute towards positive, informed outcomes for strata communities. The Strata Community Association (SCA) is proud to have officially released its ‘Strata Insurance Disclosure Best Practice Guide’, which sets out necessary and critical changes to how SCA members will be disclosing strata insurance practices to strata communities from 1 July 2024.
It is critical that all stakeholders, including consumers, understand the incoming changes and what is being done to enhance transparency and choice for strata residents, both in Western Australia and across all jurisdictions.
Understanding Strata Insurance Disclosure
Role of Strata Managers and Insurance Brokers
Firstly, it’s important to understand the role of strata managers in relation to strata insurance, and why they are being remunerated. Services provided by strata managers in the process of the placement of strata insurance include:
Quotation and procurement
Placement and renewal of insurance
Claims management
Record keeping
Correspondence and negotiation
Providing advice based on insurance knowledge
Strata managers bring valuable knowledge of both the insurance landscape and the specific buildings they manage, which benefits the strata committee and policy outcomes. With increasing legislative and regulatory requirements, the expertise of both strata managers and brokers is crucial, working in tandem to provide tailored insurance solutions.
Consumers in strata communities have the right to clear, concise information about their insurance policies and the remuneration involved. Therefore, by adhering to best practices in strata insurance disclosure, SCA aims to provide a transparent and informed experience for all strata communities in Australia.
Best Practice for Strata Insurance Disclosure
The main components of the best practice strata insurance disclosure guide have been summarised into three steps:
Communicate: Foster clear communication between consumers and insurance providers.
Document: Ensure all insurance-related documents are accessible and understandable.
Understand: Improve the relationship between consumers and insurance providers by fostering clear communication and understanding, leading to better experiences and outcomes for those involved in strata insurance.
Providing clear communication about choices and the specifics of insurance policies ensures that consumers are well-informed. This transparency helps in making informed decisions and enhances trust between strata communities and insurance providers.
Positive Consumer Outcomes
Strata committees should expect at least three clear points of communication: when they receive a quote, when the invoice is issued, and during the Annual General Meeting (AGM). This structured approach ensures that all parties are on the same page and that there are no surprises regarding insurance coverage and costs.
By following these best practices, strata communities can navigate the complexities of insurance with greater ease and confidence, ensuring that they are adequately protected and informed.
For more information, visit SCA (WA) or contact us at admin.wa@strata.community.
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