CARDIFF (dpa-AFX) - Car insurance provider Admiral Group Plc. (ADM.L) Monday said it anticipates a higher than expected Group profit before tax from continuing operations for the first half of 2021 in the range of 450 million pounds to 500 million pounds.
According to the company, the stronger expected result is due to unusually positive development in the cost of UK motor bodily injury claims from a number of prior underwriting years. This has led to higher reserve releases and profit commission revenue.
The company noted that the motor claims frequency in 2021 to date has been lower than expected due to extended lockdown restrictions resulting in a favourable current period loss ratio.
There were significant reductions in Admiral's premium rates over the past twelve months, which followed the 110 million pounds of premium refunded to customers in May 2020.
Further, the company said the proposed 2021 interim dividend is expected to be in the range of 110 to 125 pence per share.
It is not currently expected that the level of reserve releases and profit commission for the first half of 2021 will be repeated in the second half.
The sale of the Penguin Portals comparison businesses was completed on April 30. Of the net proceeds from the deal of around 460 million pounds, Admiral expects to return 400 million pounds to shareholders in the form of special dividends phased over 2021 and 2022.
The first payment will be made with the interim 2021 dividend.
Admiral will publish its 2021 half year results on August 11.
Copyright RTT News/dpa-AFX