Documents from a Victorian government-backed strata review allegedly show that the country’s largest strata operator argued privately against banning insurance commissions – a move that consumer groups say shielded a major industry player from scrutiny while the Allan government chose not to act on the reform.
PICA Group allegedly made a confidential submission to the Victorian government’s strata review panel arguing that outlawing insurance commissions would bring down most of the industry, according to a report by The Age published on June 8, 2026. The claim – that 70% of strata management companies would fail if commissions were banned – was allegedly made in a submission the panel permitted to remain outside the public record. It came to light only because the panel’s final published report referenced it in a single footnote, identifying PICA Group as the source.
The expert panel, led by former Labor consumer affairs minister Marsha Thomson, alongside economist Karen Chester and strata lawyer David McKenzie, received 159 submissions in total. Of those, 121 were made available on the Engage Victoria website. The remaining 38 were treated as confidential, shielding both the identities of those submitters and the content of what they put to the panel. On top of written submissions, the panel held direct discussions with 53 organisations, though 20 of those were redacted from the published list. Public inquiries routinely permit confidential submissions to protect commercially sensitive information, but the arrangement drew criticism in this case given the scale of PICA Group’s presence in the sector under review. A Victorian government spokesman, when asked by The Age about the confidentiality granted to PICA Group, said only that “the review was conducted independently of government.”
PICA Group’s interest in the commission debate is not incidental. The company reportedly manages properties with a combined national value of around $72 billion and operates through 26 different brands, giving it roughly a 10% share of the strata management market across the country. Its chief executive, Bobby Lehane, previously ran strata insurer CHU Underwriters – a background that places him at the intersection of both sides of the insurance commission arrangement.
The company was also at the centre of a separate controversy reported by The Age in May 2026, when leaked audio from one of its brands, Ace Body Corporate Management, allegedly captured a senior manager attempting to solicit unlawful payments from a supplier. That matter has not been adjudicated. Despite declining to release its submission, PICA Group pushed back on the suggestion it had sought to keep its views hidden. “PICA Group has been very open and public about our concerns regarding the prohibition of insurance commissions. We believe both consumers and the strata management sector would be worse off under such a change,” the company said in a statement, as reported by The Age.
Adam Promnitz, who heads the Strata Owners Alliance, a grassroots group representing lot owners, took a different view of the process. “Classic closed-door lobbying from the strata industry’s big end of town. Transparency matters, and the influence of the big end of town in strata should not be hidden from public view. We disagree with the 70% claim completely and have never seen credible evidence to support it. It feels like scaremongering to protect their interests,” Promnitz said, as reported by The Age.
The 121 submissions that were made public show the commission question cut sharply along interest lines. Lot owners, volunteer committee members, and consumer bodies – among them the Strata Owners Alliance, Mortgage Stress Victoria, Financial Counselling Australia, and Financial Counselling Victoria – backed an outright ban. On the other side, industry associations and strata professionals, including the Strata Community Association Victoria and the National Insurance Brokers Association (NIBA), defended the continuation of commissions.
The core concern for those pushing for a ban is structural: when a strata manager’s income from insurance is tied to the size of the premium, the financial logic allegedly favours placing owners with a more expensive policy rather than a more suitable one. Ban advocates argue that only a shift to a fee-for-service model could remove that misalignment. The industry’s counterargument is that the money does not disappear – it shifts. Without commission income, strata managers would need to recover those costs through higher flat fees charged directly to owners corporations, meaning lot owners could end up paying a comparable amount through a different line item.
The expert panel called for a full prohibition on strata managers receiving any financial benefit from insurance or other suppliers, whether disclosed or not. To support that position, the panel drew on a finding from the Hayne banking royal commission that “disclosure alone is often ineffective in addressing conflicts of interest and protecting consumers.” The Allan government’s response, however, did not go that far. It recorded the recommendation as “support in principle” while flagging that “a ban could potentially have strong market effects including an increase in the service fees OCs pay to professional managers and other market disruptions,” and called for further work before any decision could be made.
Undisclosed commissions are already prohibited under Victorian law. The debate centres on whether even transparent, declared commission arrangements should be permitted to continue. When The Age pressed Consumer Affairs Minister Paul Edbrooke on why Victoria needed to repeat analysis already carried out by the New South Wales Productivity and Equality Commission – which found that removing commissions could deliver more than $300 million in net benefits over 15 years – Edbrooke indicated each state needed to draw its own conclusions. He did not provide a timeframe for completing that work.
“The changes introduced to parliament this week are the first of many reforms – and we’re not done,” a government spokesman said, as reported by The Age. Opposition consumer affairs spokeswoman Jade Benham said the government’s handling of the issue left questions unanswered. “Secret commissions may be banned, but the broader question is whether commission and rebate arrangements are creating conflicts of interest that disadvantage lot owners and renters,” Benham said.
The stakes in this debate reflect the scale of the sector it covers. Victoria had approximately 128,896 active owners corporations as of 2024, encompassing more than one million individual lots and housing roughly 18% of the state’s population, according to figures cited in the expert panel’s report. That base is expected to keep growing: the Victorian government has set a target of 800,000 new homes over the next decade under its Housing Statement, a large portion of which will be medium- and high-density developments governed by owners corporations. The resolution – or continued deferral – of the commission question will shape how strata insurance is sourced and structured across that expanding market for years to come.
