AUS: ACCC not to oppose merger NRMA/RACV insurance
The Australian Competition and Consumer Commission today announced it will not oppose the merger of the insurance operations of the NRMA and the RACV.
"In most insurance categories the merger does not raise competition issues," ACCC Chairman, Professor Allan Fels, said today. "The ACCC's view is that in most insurance products the merged group would not have a market share sufficient to raise competition concerns".
The merger combines two of the largest suppliers of comprehensive motor vehicle insurance in Australia.
NRMA is the largest supplier of motor vehicle insurance in NSW and RACV is the largest in Victoria. The two firms compete in Victoria but not in NSW. Independent estimates indicate that the merged firm will have around 40 per cent of Victorian comprehensive motor vehicle insurance.
The merger is likely to enable the parties to achieve cost savings and diversify their operations across more insurance products and a larger geographic area.
"After conducting market inquiries, the
ACCC found that competition from other insurance companies
and the potential for companies not currently providing
motor vehicle insurance to supply such services, would
ensure that the market remained competitive after the
merger," Professor Fels said.