Insurance Australia Group’s (IAG) acquisition of RACQ Insurance has been cleared by the Australian Competition and Consumer Commission (ACCC), prompting concerns from the Motor Trades Association of Australia (MTAA) over potential market dominance.
Rod Camm (pictured), interim executive director of the MTAA, expressed concern that the deal could further centralise underwriting control in the hands of a few major insurers, undermining local market diversity and affecting downstream players in the vehicle repair sector.
“By handing over yet another iconic motoring brand to a corporate behemoth, the ACCC has effectively adversely altered structure in the Australian insurance sector. This decision will turbocharge market dominance and leave Australians with fewer choices and higher costs,” he said.
The IAG–RACQ agreement is part of a broader shift in the industry. IAG has also proposed a two-decade underwriting partnership with RAC WA, which remains under ACCC review.
According to the MTAA, such arrangements may lead consumers to believe they are still covered by traditional, community-rooted motoring clubs, even as control shifts to corporate entities.
“Consumers may continue to see trusted local brands, but the reality behind the scenes is a corporate takeover,” Camm said. “These arrangements ruthlessly strip decision-making away from locally accountable institutions and hand control to national corporate agendas that prioritise profits
In parallel, Allianz is pursuing a deal to acquire RAA Insurance in South Australia. If finalised, these transactions would result in three motoring club insurers being operated under the umbrellas of IAG and Allianz, Australia’s two largest general insurers.
The MTAA argued that these consolidations could place increased cost and operational pressure on small and family-run repair businesses. It also warned of reduced accountability and diminished consumer influence as corporate ownership expands.
The association is renewing its push for legislative reforms to the Motor Vehicle Insurance and Repair Industry (MVIRI) Code of Conduct. It is calling for stronger enforcement mechanisms, including the introduction of penalties and broader ACCC oversight.
These industry developments coincide with broader regulatory changes set to take effect in 2026.
Under the Treasury Laws Amendment (Mergers and Acquisitions Reform) Act 2024, certain mergers will soon be subject to mandatory notification thresholds.
The ACCC released draft procedural guidelines in March, outlining the steps businesses must follow under the new rules. The goal is to enhance transparency and streamline the review of acquisition proposals, particularly those deemed low risk.
