Australia's competition regulator, the Australian Competition and Consumer Commission (ACCC), has ruled that Insurance Australia Group (IAG) cannot proceed with its planned acquisition of RAC Insurance, determining the deal would significantly weaken competition in the Western Australian market. The ACCC's second-phase review found the transaction would substantially reduce competition in Western Australia's motor vehicle and home contents insurance sectors.

ACCC Chair Gina Cass-Gottlieb stated that competitive constraints from other insurers would be insufficient to offset the reduction in competition resulting from the acquisition. Eligible companies may submit applications for public interest exemptions, with the ACCC required to make a determination within 50 business days, though this timeframe can be extended.

Insurance Australia Group initially sought informal clearance in 2025, with the ACCC rejecting the deal in December 2025. The company subsequently resubmitted its application in January 2026 under the formal merger notification framework.