One of Australia's most high-profile strata management firms, Netstrata, has been quietly dumping years of past insurance invoices into its clients' online portals.

For the first time, apartment owners can see how much they have paid in brokerage fees to Netstrata's insurance arm.

In some cases the fees are as high as six times the typical industry rate.

Kerrie Hutchinson's Sutherland unit block was previously charged a brokerage fee of 148 per cent of the base insurance premium.

A typical "fee for service" brokerage fee equates to 20 to 25 per cent of the base premium, according to industry experts.

"My jaw was hanging off. I couldn't believe it," she said.

She discovered the average brokerage fee charged to her strata scheme over the past decade was 68 per cent of the base premium.

Alison Steele's Camperdown complex paid brokerage fees as high as 115 per cent of the base premium.

Ms Steele, who is the treasurer of her strata committee, said it felt like a "real betrayal of trust".

"These people are meant to be managing for us, not ripping us off," she said.

Paul Mulligan manages the finances for his partner's Alexandria apartment.

His strata scheme was charged a brokerage fee of 54 per cent of the base premium this year, also well above the industry standard.

Tyrone Shandiman, chair of the Australian Consumer Insurance Lobby (ACIL), said he had "never seen this before, it's very unusual".

"We consider 40 per cent to be excessive and unreasonable," the insurance broker said.

In each case the broker was Strata Insurance Services, or SIS, which is wholly owned by Netstrata. 

The ABC has spoken to a further five Netstrata clients from separate apartment buildings across Sydney who say this is the first time the fees have been disclosed.

Some were provided the invoices over email, after requesting them from Netstrata following the ABC's earlier investigation into the strata firm.

Others say they noticed the invoices appearing in their online portals earlier this year.

Clients are concerned the uploads do not have a time-stamp showing when they were added to the portal and the company is refusing to admit it was only recently.

Mr Mulligan thinks it is indicative of an attempt by Netstrata to rewrite its past disclosure practices.

NSW Fair Trading announced an investigation into the company in May, after it was caught charging excessive fees.

A spokesperson for Netstrata said its insurance arm SIS had been "disclosing its brokerage fees in dollar values on invoices since its inception".

When asked if these invoices had been provided to clients since its inception, the spokesperson did not respond.

Exorbitant fees

Netstrata manages more than 1,000 buildings and 35,000 apartments across NSW.

According to three former Netstrata strata managers, most schemes use SIS.

The company is run by Netstrata CEO Stephen Brell's ex-wife Danielle Dickson and its head office is listed as Netstrata's old building in Carlton, next door to its new $30 million office tower.

Employees of both companies meet monthly and attend Christmas parties, team bonding and industry events together.

Netstrata discloses that SIS is a subsidiary in mandatory reports to clients and in its agency agreement.

It tells clients SIS does not receive commissions from insurers, which is true.

What it does not disclose is the amount SIS charges in brokerage fee is often higher than a straight commission.

Same link, different document

Netstrata is also telling apartment owners the brokerage fees are provided in their annual "insurance renewal" emails.

Mr Brell told the ABC in March the company sends "an email to all of our owners which discloses … our tax invoice, which outlines what the broker fees are".

The annual emails contain a hyperlink, which this year takes clients to an invoice displaying the dollar figure.

We tracked down previous insurance renewal emails sent in 2023 and preceding years.

The same hyperlink took the user to a different document.

It did not show the brokerage fee.

No refund

Ms Hutchinson was denied a refund because her fees, which ranged from 44 per cent to 148 per cent of the base premium, were "in accord" with industry expert John Trowbridge's recommendation, according to her strata manager.

The Netstrata employee sent her highlighted sections of a strata report published in 2022 by Mr Trowbridge.

A similar email was sent to other apartment owners who attempted to ask for a refund.

Ms Hutchinson contacted Mr Trowbridge to ask if this was correct and showed him her invoices.

Mr Trowbridge told her he was "deeply unhappy about my work being misrepresented and falsely used as a justification for something which it is not" and that he was "troubled by the extraordinary high fees you have been paying".

Earlier this month Mr Trowbridge told a Senate committee brokers should charge "something in the order of 10 per cent" as that was "all they need".

Netstrata told other clients the discrepancy in cost was due to its "fee for service" model being calculated on net terms, not gross.

Mr Shandiman said the industry standard for this type of fee still equated to about 20 to 25 per cent of the base premium.

A spokesperson for Netstrata said SIS charges a brokerage fee, not a commission and "care needs to be taken in comparing these approaches, which is why it is better to compare total cost of insurance".

Former Netstrata strata managers speak out

Three former Netstrata strata managers explained how the firm had been able to avoid disclosing the brokerage fees for years.

The former staff, who asked not to be named, said Netstrata signs up new clients to what's known in the industry as a "full delegated authority" contract.

This type of managing agency agreement allows the firm to make decisions on behalf of the strata committee.

The ex-Netstrata staff said as soon as a client signed the agreement, Netstrata was able to appoint its subsidiary SIS as insurance broker.

Some contracts allowed Netstrata to pay SIS's brokerage fees without disclosing the cost to the strata committee and adopt its recommended insurer without seeking approval for the quote, if within budget, they explained.

The ex-employees said while "delegated authority" agreements were not uncommon, they often had strict limitations or were viewed as an emergency measure, such as to fix a broken window without approval.

Netstrata had an "extreme" interpretation, they said, which viewed the agreement as granting "total and unfettered power to the strata manager".

During their time at the company, the former strata managers collectively held more than 100 apartment buildings across their portfolios.

They said SIS was the broker for almost all.

Until this year, NSW legislation only required strata managers to tell clients if the insurer had paid them a commission, but they were not required to disclose brokerage fees paid to a subsidiary.

The ex-Netstrata staff claim the strata firm set up SIS as a "workaround" to avoid disclosure.

A spokesperson for Netstrata said the "Owners Corporations have the right to decide on the broker they use and where the insurance is ultimately placed.