Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


IAG gets ACCC tick on Wesfarmers’ insurance takeover

IAG gets ACCC tick on Wesfarmers’ insurance takeover

By Suze Metherell

March 26 (BusinessDesk) – Insurance Australia Group, New Zealand’s largest general insurer, has gained approval from Australian Competition and Consumer Commission for its A$1.845 billion purchase of Wesfarmers’ insurance underwriting business.

But the Australian owned company, which trades in New Zealand under the State, NZI and AMI brands, is looking to buy Wesfarmers’ WFI and Lumley Insurance brands, and is still waiting for approval from New Zealand’s equivalent competition regulator, the Commerce Commission, as well as the Reserve Bank of New Zealand and two other Australian regulators.

New Zealand’s Overseas Investment Office approved the deal earlier this month.

The Commerce Commission extended the deadline for its decision by a month to the end of April, and has received nine submissions, including one which the submitter asked to remain private.

Insurance Brokers Association New Zealand have expressed concerns over competition in the market. After the proposed merger, IAG would have a 52 percent New Zealand market share, with the second largest competitor Suncorp’s Vero at 25 percent, it said in its submission. Suncorp’s submission to the Commerce Commission opposed the merger in New Zealand.

Multisure Risk Managers, the Motor Trade Association, Bus and Coach Association, the Rental Vehicle Association, and the Collision Repairs Association all made submissions to the commission over the merger, expressing concerns about competitiveness in the insurance industry.

In Australia, however, the ACCC found “no objection” to the takeover.

IAG and Wesfarmers were “the first and fifth or sixth-largest general insurers in Australia, respectively” and are also the nation’s largest rural insurers.

“The ACCC found that, while the proposed acquisition would reduce the number of key underwriters from six to five for packaged farm insurance and crop insurance in Australia, the level of existing and potential competition in this market would be expected to constrain the merged firm,” Rod Sims, ACCC chairman said in a statement.

IAG announced the deal last December and is confident the transaction will be completed by June 30.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Postnatal Depression: 'The Thief That Steals Motherhood' - Alison McCulloch

Post-natal depression is a sly and cruel illness, described by one expert as ‘the thief that steals motherhood’, it creeps up on its victims, hiding behind the stress and exhaustion of being a new parent, catching many women unaware and unprepared. More>>


DIY: Kiwi Ingenuity And Masking Tape Saves Chick

Kiwi ingenuity and masking tape has saved a Kiwi chick after its egg was badly damaged endangering the chick's life. The egg was delivered to Kiwi Encounter at Rainbow Springs in Rotorua 14 days ago by a DOC worker with a large hole in its shell and against all odds has just successfully hatched. More>>


Trade: Key To Lead Mission To India; ASEAN FTA Review Announced

Prime Minister John Key will lead a trade delegation to India next week, saying the pursuit of a free trade agreement with the protectionist giant is "the primary reason we're going" but playing down the likelihood of early progress. More>>



MYOB: Digital Signatures Go Live

From today, Inland Revenue will begin accepting “digital signatures”, saving businesses and their accountants a huge amount of administration time and further reducing the need for pen and paper in the workplace. More>>

Oil Searches: Norway's Statoil Quits Reinga Basin

Statoil, the Norwegian state-owned oil company, has given up oil and gas exploration in Northland's Reinga Basin, saying the probably of a find was 'too low'. More>>


Modern Living: Auckland Development Blowouts Reminiscent Of Run Up To GFC

The collapse of property developments in Auckland is "almost groundhog day" to the run-up of the global financial crisis in 2007/2008 as banks refuse to fund projects due to blowouts in construction and labour costs, says John Kensington, the author of KPMG's Financial Institutions Performance Survey. More>>


Health: New Zealand's First ‘No Sugary Drinks’ Logo Unveiled

New Zealand’s first “no sugary drinks logo” has been unveiled at an event in Wellington... It will empower communities around New Zealand to lift their health and wellbeing and send a clear message about the damage caused by too much sugar in our diets. More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news