Israel’s competition authority opposes merger of Harel Insurance, Isracard

Tel Aviv [Israel]: Israel’s Competition Authority Commissioner announced his opposition to a merger between two Israeli financial firms, Harel Investments in Insurance and Financial Services Ltd. and Isracard Ltd. Due to concerns over monopolistic practices. 

The Competition Authority said it carried out a “long and comprehensive inspection procedure regarding various competitive aspects” and determined that the merger raises a “reasonable fear of significantly harming competition in the field of private health insurance.” 

If the merger is approved, said the authority, there is a fear that the merged company could push its competitors out of the market or” harm their competitive ability and their ability to curb their market power.” The fear is that competition will be harmed through the use of Isracard’s customer information together with Harel’s information to determine a personalised price for customers and thus “reap more profit from a given customer base, in a way that will allow Harel to attract insurance agents.” 

Harel is Israel’s largest health insurance firm. 
The scope of the annual activity of the field of medical expenses and serious illnesses in Israel is about 4.5 billion Shekels (USD 1.25 billion). 

Isracard is the leading credit card company in Israel, which deals, among other things, in issuing credit and debit cards. Isracard has extensive and unique information on more than 40 per cent of the active debit card holders in the market. 

“This is information that is valuable for the purpose of analysing the patterns of the customer’s economic behaviour in a way that will also help to understand the extent of his willingness to pay for various insurance products (willingness to pay) as well as aspects related to the customer’s insurance risk,” said the Authority.