The Federal Government’s long-awaited inquiry into Australia’s insurance industry has entered the public submissions stage, with automotive industry groups using the process to raise growing concerns about insurance affordability, claims handling and repair industry practices.
Among the organisations making submissions is the MTA Group, representing automotive businesses across New South Wales and the ACT. In its 2026/27 pre-budget submission, the organisation outlined a series of reforms aimed at improving conditions for automotive workshops, dealerships and repair businesses operating within the motor insurance system.
The inquiry comes amid increasing pressure on small businesses already dealing with rising operational costs, labour shortages and expensive compliance requirements.
Insurance affordability has become a major issue across the automotive sector, particularly for workshops and body repair businesses facing higher premiums alongside tightening insurer requirements. Industry groups have repeatedly warned that some operators are struggling to secure affordable insurance cover while also dealing with increased business costs linked to tooling, training and EV transition investments.
The MTA Group also highlighted what it described as a growing imbalance between large insurers and small automotive repairers when it comes to insurance repair work. The organisation noted that the body repair industry is heavily dependent on insurer-funded jobs, creating pressure on businesses when disputes arise over labour rates, repair times and genuine parts usage.
The submission stated that Australia has more than 41 million motor vehicle-related insurance policies generating approximately $24.5 billion in revenue for insurers.
Domestic motor vehicle claims alone accounted for $14.1 billion in gross claims incurred during 2024, with much of the repair work flowing through small and medium-sized body repair businesses.
“The body repair industry is dominated by three insurers who have market control through payment dominance to small businesses,” the submission stated.
The MTA Group also raised concerns about insurers using overseas assessors and “algorithmic generated reports”, arguing the practices can create delays and disputes that ultimately affect repair businesses and consumers alike.
As part of its recommendations to government, the organisation called for a mandatory national Motor Vehicle Insurance and Repair Industry Code of Conduct administered by the Australian Small Business and Family Enterprise Ombudsman.
The proposed code would introduce mandatory Australian-based vehicle assessors, maximum 30-day payment timeframes, independent dispute resolution powers and stronger protections against unfair contract terms between insurers and repairers.
The inquiry’s public submissions process is expected to play a key role in shaping future reforms affecting insurers, repairers and automotive small businesses across Australia.