Insurance Commission
& Broker Fees

So how does it work?

Insurance Commission has been around for decades and is the remuneration which may be provided to the Owners Corporation Manager arranging the insurance on behalf of the client – you.

The Insurer can pay the commission to the Insurance Broker who may pass on or share this with the Owners Corporation Manager. They may also charge a Broker Fee as well to place and process the renewal.

Below are examples of a typical strata insurance renewal and sets out the components which make up the premium payable by an Owners Corporation.

The industry standard for commission can be up to 20% of the base premium

Charges Scenario 1
Commission
Scenario 2
Broker Fee
Horizon
Premium $48,000 $48,000 $48,000
Commission (Mgr Share) $12,000 $0 $0
Base Premium $60,000 $48,000 $48,000
GST $6,000 $4,800 $4,800
Stamp Duty $6,600 $5,280 $5,280
Gross Payable $72,600 $58,080 $58,080
Broker Fee $7,500 $19,500 $7,500
Broker Fee GST $750 $1,950 $750
Total Payable $80,850 $79,530 $66,330

There are two typical scenarios when renewing insurance as set out above. The first of these is shown above in Scenario 1 – Commission. This is based on a commission structure which can be up to 20% of the base premium. A broker fee is also charged on top of this amount, which gives the Total Payable.

Scenario 2 – Broker Fee. This is based on a broker only fee, but often incorporates the relevant commission that would otherwise be included in the base premium. In this circumstance, the commission amount included in the broker fee is then remitted to the Owners Corporation Manager.

At Horizon Strata we believe that our clients should not pay commission to place their insurance, so we have committed to giving back any additional commissions that we receive to you every year, without any questions.

On top of saving you money, Horizon works closely with reputable insurance brokers to obtain competitive premiums for our clients and ensure that every renewal complies with financial services legislation and obligations.