Admiral Group Plc - Coinsurance and Reinsurance...

Admiral  Group ("Admiral")  today announces  that it  has signed new reinsurance
contracts  with Munich Re and Hannover Re for its new car insurance operation in
the  USA, Elephant  Insurance ("Elephant").  Admiral also  announces that it has
extended  its long-term coinsurance and  reinsurance arrangements with Munich Re
for its UK, Spanish and Italian businesses, while the existing agreement for the
German business remains in place.

These  partnership arrangements build further on  the successful risk and profit
sharing  model  which  has  been  at  the  heart  of  Admiral's  success  in its
established UK business.

Munich Re and Hannover Re have both entered into quota share reinsurance
contracts with Elephant from 1(st) January 2010. Munich Re and Hannover Re will
each take one third of the USA risks and Admiral will retain one third for its
own account. Both agreements are intended to be long term. The Hannover Re
contract is for up to 10 years whilst the Munich Re agreement is for up to 15
years. Both agreements include break clauses at earlier dates. Further details
are contractually confidential.

In  Europe, Admiral  has extended  its reinsurance  agreements with Munich Re in
both  Spain and  Italy to  a total  of 15 years.  Both agreements have also been
revised to include a stronger alignment of long term interests and higher profit
commissions for Admiral if results are very positive.

In  the UK  Admiral has  extended its  current agreement  with Munich  Re for 2
further  years  to  at  least  the  end  of  2016. Munich  Re will retain 40% of
Admiral's  UK risks for these additional  years. Admiral has committed to retain
at  least 25% for the  duration of this  agreement whilst the  allocation of the
balance is at Admiral's discretion.

Commenting  on these  developments, Admiral  Chief Executive,  Henry Engelhardt,
said:  "This is  a very  good day  for Admiral  Group.  These deals will help us
perpetuate our model that minimises risk and consistently produces a high return
on  capital.  We believe it  is in our shareholders  best interest to reduce our
risk,  particularly in the early development stage  of a business, in return for
sacrificing  some of  the profit  down the  road.  This  helps us to couple good
growth with solid dividends.

"We have a long-standing relationship with Munich Re that now is likely to go on
past  2020.  We are very pleased that an organisation of such stature would have
the faith in us to commit to such a long-term agreement.  We hope to reward this
faith  by producing  substantial profits  for them  in the  future.  We are also
pleased  to increase  our co-operation  with Hannover  Re.  Hannover  has been a
growing part of our UK reinsurance programme over the last two years and we look
forward  to continuing  our mutually  beneficial relationship  for many years to
come.

"It  is an exciting  time to be  part of the  Admiral Group given our growth and
geographical  expansion and we are very pleased to be working with Munich Re and
Hannover  Re to build growing, profitable,  sustainable businesses in Europe and
the USA."

For further information, please contact:



  Admiral               029 2043 4394
  Alistair Hargreaves


  Financial Dynamics    020 7269 7200
  Rob Bailhache
                                       

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