The Australian Competition and Consumer Commission has flagged preliminary competition concerns about insurance Australia Group Limited’s proposed purchase of RAC Insurance Pty Limited, saying the deal could substantially lessen competition in Western Australia’s motor and home and contents insurance markets.
In a Statement of Issues published today the ACCC said the proposed acquisition by IAG — which would see IAG underwriting motor and home and contents insurance under the RAC brand — raises worries because both IAG and RACI currently supply those products in WA.
The regulator’s preliminary view is that the deal is likely to have “the effect of substantially lessening competition in both the supply of motor insurance and the supply of home and contents insurance in Western Australia.” The ACCC noted RACI’s dominant position in the state, saying: “RACI is the leading provider of both motor and home and contents insurance in Western Australia and has a significantly larger market share in each compared to any other insurer.”
“RACI competes strongly in Western Australia with its well-recognised brand and focus on customer service. It also appears likely to continue to compete strongly in the future, if the proposed acquisition does not eventuate.”
The ACCC warned the reduction in competition could give IAG greater ability to increase premiums and reduce product quality for both its own and RACI’s insurance offerings. The regulator is also concerned the acquisition may allow IAG to restrict rival insurers’ access to repair services — including smash repairs, windscreen and home repairs — or to raise rivals’ costs of obtaining those services in WA, undermining competition.
“We are concerned that the acquisition would increase concentration in an already highly concentrated market,” ACCC Commissioner Dr Philip Williams said.
The ACCC has invited submissions in response to the Statement of Issues by 18 September 2025; parties can contact the regulator at [email protected]. More information, including the full Statement of Issues, is available on the ACCC’s public register.
Background material published with the Statement of Issues notes IAG is an ASX-listed insurer that operates a range of personal and commercial brands in Australia and New Zealand, including NRMA, Swann Insurance, ROLLiN’, Cylo and Lumley Special Vehicles, and provides intermediated insurance under CGU and WFI. IAG also underwrites products distributed by several banks, including ANZ since 2023.
RAC is a Western Australian member‑owned mutual that provides roadside assistance and a range of member services; RACI underwrites motor and home and contents insurance for RAC. The proposed acquisition does not include RAC’s roadside assistance business or its other operations such as auto servicing and repair services, finance, retirement living, home security, batteries, tyres, travel and tourism.
