Question: Is the committee allowed to exceed the major spending limit for insurance, and if so, must two quotes be included with the notice of the AGM insurance motion?
Is the committee allowed to exceed the major spending limit for the scheme when it comes to insurance, and if so, is it still required to obtain two quotes pursuant to section 163 of the Act (Accommodation Module)? If so, must the two quotes be included with the notice of the Annual General Meeting?
Whilst it is settled that a committee can spend above the spending limit for the committee, there is no specific mention of insurance in section 163. It merely states that two quotations are required if a proposal’s cost exceeds the scheme’s major spending limit. Hence my question: must the committee include two quotes with the Annual General Meeting insurance motion?
Answer: No, section 163’s quote requirement does not apply to insurance renewal motions.
There is no requirement under section 163 for the committee to attach two quotes to an insurance motion at the AGM. Section 163 only applies where a general meeting motion proposes “the carrying out of work or the acquisition of personal property or services”, and the cost exceeds the major spending limit. Insurance renewal motions generally do not fall into this category.
Insurance is dealt with separately under section 162, which sets out when the committee can authorise spending on insurance even if the cost is above the committee spending limit. This section expressly acknowledges that insurance is a different type of decision and doesn’t require quotes to be circulated with an AGM notice.
Likewise, section 164 doesn’t automatically apply to insurance, because insurance renewal is not treated as “work” or as the acquisition of personal property or services in the same way as ordinary spending proposals.
It’s also worth noting that, unlike standard service procurements, insurance is a specialised market. There are situations, such as adverse claims histories, building defects, or very high sums insured, where only one insurer is willing or able to provide a quote, meaning it is not always possible for a committee to obtain two insurance quotes.
This information is of a general nature only and neither represents nor is intended to be personal advice on any particular matter. Shandit Pty Ltd T/as Strata Insurance Solutions strongly suggests that no person should act specifically on the basis of the information in this document, but should obtain appropriate professional advice based on their own personal circumstances. Shandit Pty Ltd T/As Strata Insurance Solutions is a Corporate Authorised Representative (No. 404246) of Insurance Advisenent Australia AFSL No 240549, ABN 15 003 886 687.
This post appears in the September 2026 edition of The QLD Strata Magazine.
Tyrone Shandiman
Strata Insurance Solutions
E: tshandiman@iaa.net.au
P: 1300 554 165
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