Do they need separate water meters?

Yes. Each dwelling in a dual occupancy must have its own water connection and individual Icon Water meter.

Icon Water requires two separate connections to the water network — one for each dwelling. Sub-metering between the two dwellings is not permitted.

Reference: Icon Water – STD-SPE-M-006 Property Service Connections and Water Meters; Standard Drawing SD-3350-C – Typical Dual Occupancy Installation - https://www.iconwater.com.au/Developers-and-Renovators/water-meters/guide-water-metering-class-b-developments