Why did the ACCC reject IAG's acquisition of RAC WA Insurance?

The ACCC rejected the deal due to concerns that it would significantly reduce competition in Western Australia's motor vehicle and home insurance markets.

What was the value of the proposed IAG and RAC WA Insurance deal?

The proposed acquisition was valued at $1.35 billion (A$2.02 billion), including shares and a distribution agreement.

Home / Business and Economy / ACCC Blocks IAG's $1.35bn RAC WA Insurance Takeover

ACCC Blocks IAG's $1.35bn RAC WA Insurance Takeover

Q: Will IAG still pursue the RAC WA Insurance business?

IAG intends to seek further assessment under Australia's new mandatory merger control regime, which starts in January 2026.

13 Dec

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Summary

ACCC rejects IAG's $1.35bn acquisition of RAC WA Insurance.
Concerns over competition in WA's motor and home insurance markets.
Deal could lead to higher premiums and reduced product quality.

ACCC Blocks IAG's $1.35bn RAC WA Insurance Takeover

The Australian Competition and Consumer Commission (ACCC) has halted Insurance Australia Group's (IAG) proposed $1.35bn acquisition of RAC Insurance. The decision stems from concerns that the merger would substantially lessen competition for motor vehicle and home insurance in Western Australia.

The ACCC's review concluded that the deal, which included a 20-year distribution and licensing agreement, would significantly reduce competition. It was projected to give IAG a dominant market share, potentially leading to higher premiums and a decline in the quality of insurance products offered to Western Australians.

Despite IAG's commitment to maintaining local operations and enhancing member experiences, the ACCC found that other market players were unlikely to offset the competitive impact. IAG plans to seek further assessment under Australia's new mandatory merger control regime, which takes effect in January 2026.