The Motor Trades Association of Australia (MTAA) has expressed deep disappointment at the decision by the Australian Competition and Consumer Commission (ACCC) to approve Insurance Australia Group's (IAG) acquisition of RACQ's insurance operations.
According to a media release by MTAA, the interim executive director Rod Camm said the ACCC’s approval is a dangerous step toward the concentration of Australia's insurance sector in the hands of a few dominant players. He said this can result in dire consequences for consumers and businesses alike. “This is an assault on competition,” Mr Camm said.
“By handing over yet another iconic motoring brand to a corporate behemoth, the ACCC has effectively adversely altered the structure in the Australian insurance sector. This decision will turbo charge market dominance and leave Australians with fewer choices and higher costs.”
Earlier this month, IAG had announced a 20-year underwriting agreement with RAC WA, a deal still subject to ACCC approval, which MTAA has strongly denounced as misleading for consumers and catastrophic for independent repairers.
Mr Camm said, "Consumers may continue to see trusted local brands, but the reality behind the scenes is a corporate takeover.
"These arrangements ruthlessly strip decision-making away from locally accountable institutions and hand control to national corporate agendas that prioritise profits over people."
The MTAA has said the consequences of this unchecked consolidation could be alarming and result in
crippling pressure on independent and family-run repairers, many of whom will struggle to survive.
Also, it could result in eroded service quality and vanishing consumer choice, as the industry becomes homogenised under corporate control.
MTAA has also renewed its call for reforms to the Motor Vehicle Insurance and Repair Industry (MVIRI) Code of Conduct, including enforceable penalties and stronger ACCC oversight.
Mr Camm said, “This is a missed opportunity to safeguard choice and accountability in Australia’s insurance landscape. We urge the Government to act now to protect the long-term interests of both motorists and repairers.”