The Australian Competition and Consumer Commission (ACCC) has announced that it will conduct an in-depth Phase 2 assessment of Insurance Australia Group Limited's (IAG) proposed acquisition of RAC Insurance (RACI). The ACCC believes that this acquisition could significantly lessen competition in the motor vehicle and home insurance markets in Western Australia.

RACI, owned by the Royal Automobile Club of Western Australia, is a leading provider of motor vehicle and home insurance in WA. The merger would allow IAG to underwrite insurance under the RAC brand, raising concerns about the competitive landscape.

ACCC Chair Gina Cass-Gottlieb emphasized the importance of this acquisition, stating that it would combine two of the largest insurers in the region. The commission is also evaluating the potential impact on smash repair services related to the acquisition.

The ACCC has not yet reached a conclusion and is inviting submissions regarding the Phase 2 review until May 4, 2026. This review follows IAG's previous unsuccessful attempt to gain clearance for the acquisition under the informal merger regime in December 2025.

Under the new formal merger regime that began on January 1, 2026, IAG has re-notified the acquisition, prompting the ACCC's current review. The commission has up to 90 business days to complete the assessment unless extended under specific circumstances.