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ACCC Scrutinises IAG's Proposed Acquisition of RAC Insurance

Potential Impact on Competition in Western Australia's Insurance Sector

ACCC Scrutinises IAG's Proposed Acquisition of RAC Insurance?w=400

The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.

The Australian Competition and Consumer Commission (ACCC) has expressed concerns regarding Insurance Australia Group's (IAG) proposed acquisition of the Royal Automobile Club of Western Australia's (RAC) insurance business.
The deal, valued at A$1.35 billion (approximately $877 million), aims to expand IAG's presence in Western Australia.
However, the ACCC warns that this consolidation could diminish competition in the region's motor and home insurance sectors.

According to the ACCC, the acquisition would result in IAG underwriting motor and home insurance under the RAC brand, potentially leading to increased premiums and reduced service quality for consumers. The regulator also highlighted the possibility of IAG limiting competitors' access to quality and cost-effective repair services, which could raise operational costs for rival insurers.

IAG has acknowledged the ACCC's concerns and stated its intention to engage with the regulator to address these issues. The Sydney-based insurer announced the acquisition in May as part of its strategy to strengthen its footprint in Western Australia. RAC, established in 1905 and headquartered in Perth, offers a range of services, including insurance, roadside assistance, and travel.

For tradespeople in Western Australia, this development is particularly significant. A reduction in competition within the insurance market could lead to higher premiums and fewer options for tailored coverage. It's essential for tradies to stay informed about these changes and consider how they might impact their insurance needs and costs.

As the situation unfolds, tradespeople should review their current insurance policies and explore alternative providers to ensure they continue to receive comprehensive coverage at competitive rates. Engaging with insurance brokers who understand the specific needs of tradespeople can also provide valuable insights and assistance in navigating potential market changes.

Published:Sunday, 12th Oct 2025
Source: Paige Estritori

Please Note: If this information affects you, seek advice from a licensed professional.

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Subrogation:
An insurance carrier may reserve the "right of subrogation" in the event of a loss. This means that the company may choose to take action to recover the amount of a claim paid to a covered insured if the loss was caused by a third party.