It’s easy to see why Suncorp CEO John Mulcahy is in good spirits after the holiday break. Despite speculation that the Suncorp-Promina merger would not survive, the Australian Competition and Consumer Commission (ACCC) gave it the green light on December 20.

Federal Minister for Revenue and Assistant Treasurer Peter Dutton also gave approval for the deal to go ahead under section 14 of the Financial Sector Shareholdings Act, endorsing the proposal on the grounds that it is in the national interest.

Mr Mulcahy told Sunrise Exchange News there may be further consolidation in the Australian market, but it will depend on a couple of factors.

“Following Suncorp’s acquisition of Promina, it will be up to the ACCC as to whether [further consolidation] could involve two large domestic companies.”

He says it’s likely more consolidation will be outside the top five insurers. “Future consolidation may involve smaller domestic insurance companies, as well as overseas companies that are looking to scale up in response to competitive market conditions.”

Promina shareholders will vote on the merger proposal on March 5. A combined Suncorp-Promina group will be Australia’s second-largest car and home insurer.