NRMA’s owner to buy RACQ insurance
NRMA’s parent company IAG will acquire the insurance business of the Royal Automobile Club of Queensland, buying 90% of the business for $855 million, with an option to buy the remaining 10% after two years.
The deal gives IAG a 25-year exclusive distribution agreement to sell home and car insurance policies, and according to the AFR, has been in the works since May.
Morgan Stanley analyst Andrei Stadnik said the deal “addresses IAG’s low market share in fast-growing Queensland” but “it is not clear exactly how profitable RACQ is, given recent member remediation and additional reinsurance for CTP book in run-off”.
“Our view is that until these issues are resolved, it is hard to be clear on the full impact and merits of the deal.”
The takeover won’t impact the RACQ brand in Queensland, or the NRMA brand.
“RACQ will maintain brand and customer relationships, while leveraging IAG’s scale and financial strength, best-in-class technology for claims, policies and pricing, customer orientated claims experience and underwriting expertise,” IAG chief executive, Nick Hawkins, said.
RACQ chief executive David Carter said IAG had “made a major commitment to Queensland, and RACQ and brings a deep understanding of member-focused organisations”.
The deal will finalise late 2025, subject to ACCCC approval.
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