The Motor Trades Association of Australia (MTAA) has welcomed the ACCC's preliminary assessment that Insurance Australia Group's (IAG) proposed $1.35 billion acquisition of RAC Insurance is unlikely to deliver a net public benefit and should not proceed.
The regulator first opposed the acquisition in December 2025 and formally blocked it in September 2026. IAG responded by lodging a public benefit application. The ACCC has now expressed the preliminary view that the claimed benefits are overstated and outweighed by significant anti-competitive harm.
MTAA Executive Director Bruce Billson said the ACCC's findings vindicated what MTAA and its members had been saying for two years.
"The ACCC has confirmed what we told them in three separate submissions: this deal would entrench a dominant insurer in Western Australia, reduce competition and leave thousands of small repair businesses at the mercy of a single company controlling up to 65 per cent of the WA motor insurance market," Mr Billson said.
"IAG's remedy package, including divesting its NRMA WA book and promising $20 million in community funding, was window dressing. The ACCC has seen through it."
Mr Billson said IAG’s move to acquire RAC Insurance reflects a broader pattern of insurance market consolidation that is reshaping the sector nationally.
"In the space of two years, the insurance businesses of RACQ in Queensland and RAA in South Australia have been swallowed by major national insurers. We are already seeing the consequences in South Australia: reduced consumer choice, jobs lost, and increasingly aggressive insurer conduct toward local repairers," he said.
"If this deal proceeds, RAC Insurance would be next, and RACT in Tasmania would be the only member-owned motoring club in Australia still running its own insurance business. That should alarm every motorist and every repairer in the country."
MTAA called on the ACCC to hold the line and issue a final determination blocking the acquisition when it makes its decision, expected by 1 February 2027.
"Behavioural promises from a dominant insurer are no substitute for genuine competition. The ACCC's own guidelines say structural problems need structural solutions. We agree," Mr Billson said.
MTAA also renewed its call for a binding national Motor Vehicle Insurance and Repair Industry Code of Conduct that governs fair commercial conduct, enforceable by the ACCC, to address the systemic power imbalances between insurers and repair businesses that consolidation continues to worsen.
ENDS
Media contact
Claire Johnson
Motor Trades Association of Australia
M: 0401 282 550
E: info@mtaa.com.au
