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IAG proposes remedies to win ACCC approval for RAC Insurance buy
IAG’s A$1.35 billion deal would give it roughly 55% to 65% motor market share and about 50% to 60% home and contents share in Western Australia, figures the ACCC cited as raising competition concerns.
Insurance Australia Group Limited has submitted a package of proposed remedies to Australia’s competition regulator, the ACCC, as it seeks approval for its planned acquisition of RAC Insurance Pty Limited from the Royal Automobile Club of Western Australia, after the ACCC previously opposed the deal.
The transaction was announced in May 2025 and values the acquisition at A$1.35 billion, made up of A$400 million for IAG to buy 100% of RACI’s shares and an upfront A$950 million payment tied to a 20-year exclusive distribution and brand licensing agreement for RAC-branded home, motor and niche insurance products.
In December 2025, the ACCC opposed the acquisition, pointing to RACI’s position as the market leader in Western Australia for motor vehicle and home and contents insurance, with competition supported by the RAC WA brand, pricing and claims service. The regulator also said the combination would leave IAG with overall market shares of approximately 55% to 65% in motor vehicle insurance and around 50% to 60% in home and contents insurance in Western Australia, given IAG’s strong presence through its NRMA brand and financial and IT capabilities.
IAG’s updated proposal, filed after the transaction was re-notified under Australia’s new mandatory merger regime, comes as the ACCC is expected to deliver a final determination by late August 2026. Among the commitments, IAG proposed annual product competitiveness assessments and competitive benchmarking, including frameworks to keep RAC-branded products competitive in Western Australia and ensure members are not offered terms less favourable than other RACI products in the region.