Admiral chief brushes off Brexit blues as profits rise
INSURANCE giant Admiral Group has brushed off Brexit fears – but warned drivers to expect further premium rises this year.
Chief executive David Stevens said he was confident a deal could be done with the European Union after the vote to leave.
Admiral, which employs 8,000 staff at its headquarters in Wales, said that UK jobs would not be cut however negotiations turned out.
Finance businesses are concerned that leaving the EU could deprive them of prized passporting rights which allow services to be sold across the Continent from a British base. Admiral relies on these rights for its work in France, Spain and Italy.
Stevens said it was in everyone’s interest to preserve current arrangements but even if access was lost, he said: ‘We would hope that some rational solution is negotiated, so that passporting rights in both directions are sustained.’
He said he didn’t think any of the possible scenarios would make much difference: ‘We wouldn’t anticipate any change in headcount as a result of this.’
The cost of insuring a car has increased in the last year after previous falls, partly due to a tax hike by former Chancellor George Osborne.
This rise has also been driven by huge numbers of whiplash claims – more than 840,000 last year – many of which are thought to have been fraudulent.
Stevens said: ‘There will be some further increases in the second half of the year. But the market should level off in 2017.’
Admiral yesterday announced profits of £189.5m for the six months to June 30, up 4.3pc on the previous year.
It hiked its dividend by 23pc to 62.9p a share. But shares fell 87.7pc, or 173p to 2081p.
Hargreaves Lansdown analyst Nicholas Hyett said: ‘Investor expectations are high, and with shares up 20pc in the last three months even these results have not been enough to keep them from falling back.’
British car insurance was the company’s key driver of profits, with customer numbers up 11pc to 3.5m. It also netted £95.6m in other revenue, such as charges for breakdown cover.