An Australian insurer has launched a direct insurance, lower cost offering for strata unit owners and body corporate committees in North Queensland. But, is this really going to be of any service to the Strata industry?
On 30th April 2015, the National Insurance Brokers Association (NIBA) released a statement in response to this new offering, cautioning people against obtaining Strata insurance directly from an insurer as opposed to going through a broker.
In summary, as listed by NIBA CEO - Dallas Booth, there are several key reasons you should be arranging your Strata Insurance via a broker:
- Each Strata building has very unique risk requirements and challenges
- Every Strata Insurance policy varies - you need to be certain your policy aligns with your specific needs
- The Sum Insured MUST be accurate or the Strata owners could be significantly exposed in the event of a major loss
- Insurance companies do not give product advice to clients - Booth points out that, "As a general rule, insurance companies do not give advice to clients on what product is appropriate – only licensed insurance brokers do this.”
- Claims advocacy – a broker will ensure you get the best possible outcome
- Navigating your legal obligations – only qualified insurance brokers can guide the committee regarding compliance with current State laws
We strongly support the view held by NIBA, not only as brokers ourselves, but also observers on a day to day basis of how direct insurance can leave clients with inadequate insurance cover.
As brokers we always act in the best interests of the client and present solutions that suitably align with their needs, while ensuring it is also cost efficient in the value it provides.
We act as a client advocate when a claim is lodged or if it is declined and needs to be escalated further. We also ensure that the Strata policy complies with all current legislation. This may not necessarily be the case where a direct insurer is concerned.
It’s very clear – by substituting the importance of expert advice for the promise of cheaper premiums, any savings you might gain by going direct could mean very little in the long run.
If you are currently insured directly with an insurer or are considering going direct, we recommend that you read the full news release by NIBA here or contact us on 1300 424 627 for expert advice.