The National Insurance Brokers Association (NIBA) has been defending insurer commissions again, warning against overreach after the NSW Productivity and Equality Commission proposed restrictions in strata. NIBA referred to the Quality of Advice Review that retained the exception to the ban on conflicted remuneration for general insurance products. Commissions remain the backbone of remuneration for most general insurance brokers but in one of the market’s hardest corners, the model is starting to bend. In brokered home insurance for high-value and high-risk properties, some brokers are increasingly pushing for net-rated products that let them charge clients directly rather than rely on insurer commission.
Fee-based remuneration has long been common in specialty lines such as D&O, marine, aviation and other complex commercial risks. What is new, or at least becoming more visible, is the way that logic is appearing in brokered home insurance as placements become harder, premiums rise and consumers struggle to navigate an increasingly fragmented market.
One clear precedent in the home insurance sector comes from the prestige end of the market. In 2022, Mansions of Australia moved from a traditional pricing model to a “consumer first” approach under which premiums would be net insurance premium only and broker remuneration would become a customised fee-for-service model only.
“Quite a few brokers have elected to go no commission, fee only,” said Robert Kelly, CEO of Steadfast Group whose wholly owned agency Prevail now underwrites the former Mansions of Australia offering. “Our Mansions offering, which is now Prevail Elite Home, has for the last three years been fee-based, and brokers are now quite accustomed to that.”
Kelly's comment suggests fee-based remuneration, at least in prestige home insurance, is no longer novel but familiar to brokers operating at that end of the market.
The more interesting development could be that the same approach to fees is now beyond prestige-only products and available in harder-to-place householders' business more broadly. One major insurer, QBE, said it would stop offering domestic householders’ insurance directly through its broker channel from October 1, 2025 and instead enter new arrangements with Sure Insurance and its newly launched broker channel brand, Castle Insurance.
Brad Heath (pictured), managing director of Sure Insurance, said growing numbers of brokers are asking for a zero net commission option in home insurance. “A lot of brokers are saying to us, ‘We cannot deal with you at the moment because we want a net commission option," he said. "We are about to bring that facility in so you can choose net commission of zero, or you can choose to be paid commission on behalf of your customer."
Heath said this is not new but is a growing trend in this part of the market where brokers are regaining relevance. Customers are drifting back from direct channels to brokers, “particularly the high-value houses and the houses that are high risks,” said Heath. This is partly because home insurance is becoming less homogenised and harder for consumers to navigate.
So there could be signs of a real shift emerging at a tougher end of the market. Prestige home insurance got there first. Now, as risks become more complex and premiums harder to justify, the same fee-based logic appears to be gaining more traction in brokered cover for exposed, unusual and high-value homes.
