IAG offers competition promises to secure regulator approval

• Insurance Australia Group submitted a formal remedy offer to the Australian Competition and Consumer Commission to secure its planned acquisition of the general insurance arm of the Royal Automobile Club of Western Australia.
• The ACCC will decide on the renewed acquisition bid by Sept. 23, which is intended to advance a deal originally priced at $1.35 billion.
• The company aims to address regulatory concerns that the transaction would reduce competition by using an independent auditor to oversee its five-year pricing and smash repair commitments.

Insurance Australia Group (ASX:IAG) has lodged a five-year remedy offer with the Australian Competition and Consumer Commission to resolve anti-competitive concerns surrounding its proposed $1.35 billion acquisition of the insurance arm of the Royal Automobile Club of Western Australia.

The fresh undertaking follows an earlier decision by the competition regulator to block the transaction in December 2025 due to concerns that the combined entity would control up to 65% of the Western Australian motor insurance market.

“I don’t think the combination of our business and the RAC will materially change the construct of the market here in WA,” said Insurance Australia Group CEO Nick Hawkins.

The secondary details of the commitments outline that an independent auditor would report annually to the regulator to verify that the business does not squeeze out rivals or pressure local smash repair workshops.

Following the announcement, the Insurance Australia Group share price was unchanged at $6.10.

The broader business strategy driving the transaction relies on an initial May 2025 agreement where the buyer pays $950 million to distribute products under the partner brand for 20 years.

The transaction represents the first major financial services deal subjected to closer scrutiny under the updated mandatory merger control regime that commenced at the start of 2026.