Admiral staff cashing in on car insurer’s profits

By MARTIN FLANAGAN
Published on 06/03/2013 20:59

Car insurer Admiral is to hand its 6,500 staff another £1,500 in free shares after marking its 20th year of trading with a 15 per cent rise in full-year profits.

A similar amount was distributed at the half-year stage, and Admiral – which as well as its eponymous brand owns the comparison website Confused.com – also hoisted its full-year dividend 20 per cent to 90.6p.

The company said the trading improvement came despite a much more competitive car insurance market than in the previous two years.

Admiral cut its UK rates by 6 per cent as it wrote premiums worth £1.7 billion during the year. Pre-tax profits were £345 million as turnover edged up 1 per cent to £2.2bn. Chief

executive Henry Engelhardt, who was with the business when it sold its first policy over the telephone in 1993, said he believed the group’s prospects over the next 20 years would make progress in the past two decades “seem downright pedestrian”. He said: “We’ve done the heavy lifting, the first 20 years. We’ve put the hole in the ground and we’ve got the cranes in place, all that’s left to do is to build the metaphorical skyscraper.”

The chief executive added

Admiral, which provides cover for 3.5 million vehicles, refused to chase more policyholders at the expense of financial returns.

“Prices in the market fell more than 10 per cent in 2012. We chased it some of the way down but not all the way down. As a result we kept some integrity with regard to margin,” Engelhardt said.

Confused.com grew profits for the first time in four years in 2012, up £2m to over £18m. Analysts said the comparison website faced tough challenges, with motorists less motivated to shop around if they see their policy renewal rates fall.