Do ESM receive commissions?


ESM do not have any agreements with contractors to provide commissions for any work we allocate to them. The price the strata company pays for works carried out by the contractor is solely the cost that the contractor charges.

Insurance premiums

ESM have always received commission income, which is a percentage calculated by the insurers and paid by them from the policy base premium. Whilst the percentage commission has always been shown, ESM is now required to show the amount as per the Strata Titles Act. A general perspective is ESM arrange insurance on your behalf as per a strata management agreement and to do this they must be authorised, which requires compliance. Further ESM assist the strata, by handling emergency claims and claims administration in general in the first instance, paying premiums and ensuring valuations are done.   

All insurance companies build in a commission to their policy, so owners would not pay less by going direct to the insurance provider. This works in a similar way to a travel agent being paid a commission by an airline - it costs the same to the consumer, whether they book direct or use a travel agent. 

STAA 2018

With the introduction of the new Act, Strata Management Companies will be bound by duty of disclosure rules to inform each strata company how much commission they receive from the placement of their insurance. These new disclosure rules will also cover gifts (over a certain value) which companies may give at certain times of year, such as Christmas.