Australian regulator denies IAG's acquisition of RAC WA insurance division

Written by Emily J. Thompson, Senior Investment Analyst

Source: Yahoo Finance

Updated: Dec 12 2025

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Source: Yahoo Finance

ACCC Rejection of Acquisition: The Australian Competition and Consumer Commission (ACCC) has rejected Insurance Australia Group's (IAG) proposed acquisition of RAC Insurance, citing concerns about reduced competition in the insurance market in Western Australia.
Market Share Concerns: The ACCC's review indicated that the acquisition would give IAG a dominant market share of 55-65% in motor vehicle insurance and up to 60% in home insurance, potentially leading to higher premiums and lower quality products.
Future Plans by IAG: Following the rejection, IAG plans to apply for an assessment of their alliance under Australia's new merger control regime set to take effect in January 2026, emphasizing their commitment to local investment and competitive offerings.
Impact on Competition: The ACCC concluded that the merger would eliminate significant competition between IAG and RAC Insurance, with other insurers in the region unlikely to mitigate the loss of competitive pressure.

About the author

Emily J. Thompson

Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.