Innovation Holdings Australia (IHA) is set to take full control of iSelect after the Australian Competition and Consumer Commission (ACCC) approved the proposed acquisition.

IHA already has a 26% stake in the business and is part of IHA Group, which owns rival comparator Compare The Market and insurance provider Auto & General – which primarily operates under the brand Budget Direct.

ACCC says comparator websites generally provide services with no direct cost to consumers, while charging commissions or fees to retailers for placement in search results or for when a consumer completes a sale via referral from the comparator.

The competition watchdog considers it unlikely that IHA acquiring the remaining shares in iSelect will substantially lessen competition in any market.

“One of the major factors for this view is that only a small minority of consumers buy insurance, energy, and financial products through Compare the Market and iSelect,” ACCC says in a statement today.

“Most consumers purchase these products through other distribution channels such as brokers or direct from the retailer.”

ACCC says the two comparators would continue to face significant competition from other comparison sites, and retailers using alternative means to attract consumers after the acquisition goes through.

“The online comparison services industry is very dynamic and so the threat of new entry or expansion by a competitor is likely to constrain the merged firm,” ACCC Commissioner Liza Carver said.

“Consumers can readily purchase insurance, financial and energy products directly from the supplier, and shop around using multiple competing comparator sites including government comparison websites.”

IHA and iSelect have already entered into a Scheme Implementation Agreement, which was subject to approval from the competition watchdog.