Code watchdogs have begun a “targeted” inquiry into strata insurance brokers and expect to release findings in coming months.

The investigation covers four brokers and focuses on compliance with code obligations around remuneration disclosure, conflict of interest management and oversight of authorised representatives. 

“Investigations are one of the most important tools we have ... Where a matter warrants formal investigation, we act,” the Insurance Brokers Code Compliance Committee says in its 2024-25 annual report. “The inquiry was prompted by concerns raised with us directly and issues exposed in media reporting about practices regarding strata insurance.

“The review aims to identify conduct falling short of code expectations.”

The committee has flagged issues with strata insurance and code compliance in the past.

A committee spokesperson told insuranceNEWS.com.au that brokers in the review engage many strata managers under authorised representative or distributor agreements.

“In particular, [the review] is looking at how brokers ensure their agents are complying with the disclosure and conflict of interest obligations in the code.”

Brokers and third-party representatives including strata managers and distributors are obliged to comply with the code.

The committee’s annual breach report, released last month, said: “In 2024, breaches of this obligation impacted more clients than any other category, underscoring the importance of strong oversight and accountability across all parts of a broker’s operations.”

See the annual report here.