Steadfast CEO Robert Kelly says other states will probably “fall in line” with NSW in pursuing tougher rules on remuneration transparency and improved disclosure for services provided by strata managers.

The NSW legislation, passed last month, aims to ensure owners’ corporations can consider proposed arrangements and have clarity over fees for services. The laws also escalate enforcement and penalties.

Mr Kelly told a Senate inquiry hearing yesterday he supports the NSW legislative changes and he expects other jurisdictions will follow suit.

“I know that’s a big statement to say about Victoria and NSW,” he told the hearing. “Where there’s massive cost of land, which means you’ve got to have more buildings on that land, anybody in a state like that needs to protect people that are participating in multistory buildings.”

Mr Kelly also defended strata broker commissions and Steadfast’s disclosure practices at the hearing, where he was questioned about issues raised in a Four Corners program.

General insurance worldwide is transacted with commissions and a recent review by Michelle Levy for the federal government has already considered issues around their role in broking, he told the inquiry.

“Just thinking that you can stop commission and reduce cost, it’s erroneous to say that,” he said.

“Somebody has to pay for the services. Whether those services are worth the cost of commission, that should be a debate between the person who seeks those services and the person who offers those services in a negotiation between them, and should be transparent.”

NSW Fair Trading has held meetings to consult on a commission ban as the state government considers further reforms.

As insuranceNEWS.com.au has reported, many who attended a recent meeting say a ban appears to be a “foregone conclusion”, and the impression given was that it will affect brokers as well as strata managers. They also said the intention is to impose the ban as early as the first quarter of next year.

NSW Fair Trading has declined to clarify the scope or timing of the proposed additional reform.

“NSW Fair Trading is consulting with representatives across the sector, including strata owner and strata managing agent representatives, insurers and brokers,” a spokesman said.

“This will inform advice to the NSW government on how the strata sector could transition away from insurance commissions.”

The Senate select committee inquiry into the impact of climate risk on insurance premiums and availability will present its final report by November 19.