Both the Motor Trades Association of Australia (MTAA) and the Motor Trades Association – South Australia and Northern Territory have expressed serious concern following the Australian Competition and Consumer Commission’s (ACCC) approval of Allianz’s acquisition of RAA Insurance Holdings. This is the second major motoring club insurance acquisition to receive approval in recent weeks, raising further alarm over growing consolidation in the sector.
The transaction allows Allianz to purchase RAA Insurance from the Royal Automobile Association of South Australia. It also involves a 20-year exclusive distribution agreement between the two organisations. The move follows the ACCC’s decision in May to approve Insurance Australia Group’s (IAG) acquisition of RACQ Insurance.
MTAA interim executive director Rod Camm said the concentration of market power among a few major insurers was reducing competition and weakening outcomes for consumers and small businesses.
“Australia is seeing a fast-moving consolidation of its insurance sector, with serious consequences for choice, pricing, and accountability,” Camm said.
“Less competition means fewer options for consumers and increasing pressure on local repairers.”
MTAA has also pointed to a third deal now underway. IAG has reportedly entered into a 20-year underwriting agreement with RAC WA.
While that deal is yet to be reviewed by the ACCC, it continues a trend that is reshaping the insurance landscape.
“These types of deals may retain local branding, but behind the scenes control is shifting to large national players,” Camm said.
“Decisions that once rested with member-focused organisations are now moving further from the communities they serve.”
Given these developments, MTAA has renewed its call for urgent reforms to the Motor Vehicle Insurance and Repair Industry (MVIRI) Code of Conduct. It is advocating for stronger enforcement powers, clear penalties, and closer regulatory oversight by the ACCC.
“This was a chance to put stronger protections in place. Instead, we are seeing decisions that reinforce
market dominance,” Camm said.
“It is essential the Australian Government steps in to protect the long-term interests of motorists and independent repairers.”
MTAA’s submissions to the ACCC regarding the Allianz–RAA and IAG–RACQ acquisitions can be accessed here.
Meanwhile, The MTA SA NT has called it a “Dark day for South Australian motorists and small business” following the ACCC’s approval of the Allianz acquisition of RAA Insurance.
The MTA SA NT has expressed its deep disappointment in the decision. MTA CEO Darrell Jacobs said South Australian motorists now have a less competitive insurance sector entirely run by corporate giants.
“This is a dark day for South Australian motorists and small businesses, with local member motor-club insurance on death’s door,” Jacobs said.
“Allianz is using South Australian trust in the RAA brand, while pulling the wool over their eyes. With this decision, South Australian motorists will get stung.”
While considering the decision to allow Allianz to use the RAA local branding, Jacobs reflected, “RAA Insurance is now as local as lederhosen.”
Jacobs said the decision concentrates the South Australian motor insurance market into the hands of a few multi-national and publicly listed insurers, warning that the combined market share of RAA Insurance and Allianz would have long term consequences for consumers.
“RAA Insurance has for a long time held the interests of its members first, particularly during the claims process,” Jacobs said.
“But local call centres are cold comfort for policy and underwriting decisions made overseas.
“The ability for motorists to make real choice of repair decisions is likely to be the first of many changes before us.”
The MTA is sounding the alarm on the consequences of this unchecked consolidation, predicting:
- Crippling pressure on independent and family-run repairers, many of whom will struggle to survive.
- Eroded service quality and vanishing consumer choice, as the industry becomes homogenised under corporate control.
The MTA SA NT says will continue to support the automotive industry, including local collision repairers, in this new insurance landscape in South Australia.
“Insurers need to work with automotive repairers and ensure customers get their choice of repairer without taking them for a ride – often kilometres from home.” Jacobs concluded.