ACCC Again Blocks IAG’s RAC Insurance Deal Over Competition Concerns
Synopsis
The ACCC has again blocked IAG’s proposed acquisition of RAC Insurance, warning that the deal would substantially reduce competition in Western Australia’s motor and home insurance markets and significantly increase IAG’s market share.
The Australian Competition and Consumer Commission (ACCC) has again opposed Insurance Australia Group’s (IAG) proposed acquisition of RAC Insurance, saying the transaction would substantially lessen competition in Western Australia’s motor and home insurance markets.
The decision comes after an in-depth review under Australia’s new mandatory merger regime which took effect on January 1, 2026.
IAG had previously sought approval for the deal under the former system but the ACCC opposed it in December 2025.
IAG RAC Insurance Acquisition Would Increase Market Concentration
The ACCC said the acquisition would combine two significant insurers operating across Western Australia. RAC Insurance is the market leader in both motor vehicle and home and contents insurance, while IAG already has a substantial presence in the state, primarily through its NRMA brand.
If completed, the ACCC estimates IAG would hold about 55% to 65% of Western Australia’s motor insurance market and 50% to 60% of the home and contents insurance market. The regulator said competing insurers would be unlikely to provide enough competitive pressure to offset the loss of competition between IAG and RAC Insurance.
ACCC Merger Block Follows Second Review
The ACCC’s latest decision represents another setback for the proposed transaction. IAG notified the acquisition again under the mandatory merger regime after the December 2025 decision. In April 2026, the ACCC moved the proposal into a Phase 2 review because it considered the deal could substantially lessen competition.
The regulator has previously identified IAG and RAC Insurance as close competitors in Western Australia. Its review also considered the impact of the proposed transaction on insurance repair services and the ability of rival insurers to compete in the state.
The decision keeps RAC Insurance separate from IAG while highlighting the ACCC’s approach under the mandatory merger regime 2026. The new system requires qualifying acquisitions to receive ACCC approval before they can proceed.
Source: Investing.com
Vishal is an experienced Editor at Inspirepreneur Magazine with key interests in artificial intelligence, eCommerce, entrepreneurship, lifestyle and startup sector. Prior to joining Inspirepreneur, he was a Content Writer cum Correspondent at Siliconindia Magazine, where he worked on Company Profiles, Cover Stories, Executive Profiles, Feature Articles and Thought Leadership content.
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