Admiral extends reinsurance deal

Motor insurance provider Admiral has extended a deal to share the risks it takes on in the British cover market.

The firm's reinsurance agreement with Munich Re has been extended by two years, meaning it will pass on a 40 per cent share of its British insurance book in 2015 and 2016.

Admiral's co-insurance deals allow it to reduce its overall capital requirement and occupy a bigger share of the market, reports Reuters.

Writing in a note, Oriel Securities analysts said the impact of extending the scope of its reinsurance agreements would be "positive" for Admiral.

"Using significant amounts of reinsurance has allowed Admiral to generate industry-leading returns on equity," they added.

While the majority of Admiral's business is based in the UK, the insurer also has operations in Spain, Italy, Germany and the United States.

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2010-01-19 13:09:37 © Moneyextra.com