The insurer’s competitive advantages in motor and household insurance were the focus of discussions, alongside its ambitions for smaller business lines
RBC Capital Markets has reiterated its ‘outperform’ rating and 3,560p price target on Admiral Group Plc (LSE:ADM), the Cardiff-based motor and home insurer, following an investor meeting with the company’s departing chief financial officer, Geraint Jones, and his successor, Rachel Lewis.
Admiral shares were up 16p at 3,318p.
The meeting centred on Admiral’s competitive position in UK motor insurance, where the company holds around 20% market share and a 20 percentage point advantage over rivals on its combined ratio, a key profitability measure comparing claims and costs against premiums earned.
RBC analyst Ben Cohen noted that Admiral is reinforcing its cost advantage through a new £100 million efficiency programme.
UK motor insurance prices fell 10% in 2025, though larger insurers began showing more pricing discipline in the second half of the year, with some raising premiums while others continued to cut.
The outgoing CFO indicated that the market would turn, but declined to comment on how sharply.
Progress in Admiral’s newer business lines was also highlighted as a positive.
Pet insurance broke even in 2025 and travel turned a small profit, while UK household insurance is targeting a combined ratio in the mid-80s, supported by a five to six percentage point cost advantage over the market.
The company’s multi-product strategy, offering discounts across motor and household policies with aligned renewal dates, has improved customer retention by more than five percentage points compared with motor-only customers.
Cohen said he remained comfortable with recently raised earnings per share forecasts and described current valuation multiples as an attractive entry point.
RBC’s 3,560p target is based on a 14 times multiple of forecast 2027 earnings per share, reflecting management’s commitment to high single-digit earnings growth through 2030.
Admiral confirmed that any surplus capital after dividends and potential acquisitions would be returned via special dividends or buybacks, with buybacks planned for the first half and full year of 2026.