The Motor Trades Association of Australia (MTAA) has applauded the Australian Competition and Consumer Commission (ACCC) for recognising the risks of consolidation in the motor insurance market but warned that allowing IAG’s proposed acquisition of RAC Insurance (RACI) in Western Australia would entrench a damaging trend, leaving motorists worse off.
Already this year, the ACCC has approved two major acquisitions: IAG’s takeover of RACQ Insurance in Queensland and Allianz’s purchase of RAA Insurance in South Australia. If the IAG–RAC Insurance deal is approved, three large member-based insurers will have disappeared in less than 12 months.
“This is not coincidence – it is a pattern,” said MTAA Interim Executive Director Rod Camm.
“Trusted member-based insurers are being swallowed up one by one. What’s left is a market dominated by a small number of giant players, and that means higher premiums, less choice, and greater risks for consumers.”
MTAA’s submission to the ACCC highlights that these acquisitions are not isolated events but part of a broader shift that entrenches the dominance of IAG and Allianz.
In Western Australia, RAC Insurance has long provided strong, independent competition. Its removal would hand IAG control of up to 70% of the state’s motor insurance market. This would weaken competitive pressure, drive up premiums, reduce consumer choice, and further restrict motorists’ ability to select their preferred repairer.
MTAA also warned that consolidation threatens the viability of thousands of independent repair businesses across Australia. Fewer insurers with greater bargaining power could force repairers into restrictive agreements, reduce fair remuneration for their work, and limit consumers’ access to trusted local workshops.
“Approving this deal risks cementing a duopoly in Australia’s motor insurance market,” Mr Camm said.
“Motorists in WA,Queensland, South Australia and beyond will all feel the impact in the form of higher costs, less transparency, and reduced competition.”
MTAA has renew edits call for the Australian Government and the ACCC to introduce a mandatory national Motor Vehicle Insurance and Repair Industry (MVIRI) Code of Conduct.The Code would protect consumers, ensure fair treatment for repairers, and place guardrails on the conduct of insurers in a market increasingly dominated by only a few players.
“The ACCC must consider the bigger picture, not just each acquisition in isolation,” Mr Camm said.
“Without stronger regulation, these deals will continue until there is no real competition left.Motorists deserve better.”
MTAA’s submission to the ACCC on the proposed acquisition of RAC Insurance by IAG can be found here: https://www.mtaa.com.au/advocacy-policy
Andrew Molloy
Manager Marketing & Communications
Victorian Automotive Chamber of Commerce
P: 03 9829 1248 | M: 0457 188 375
