Admiral shareholders gathering in Cardiff this afternoon should spare a thought for motorists struggling to pay ever-higher premiums when they vote on a record £273m dividend pay-out.
The UK’s second largest car insurer has enjoyed a 36% increase in profits from UK motorists in the three full years since the election of the current government, with the £394m it made in 2013 taking its cumulative profit in the period to £1.08 billion.
“We hear car insurers constantly portraying themselves as victims of ‘compensation culture’ and ‘whiplash fraud’, yet the reality is that they are making mouth-watering profits from motorists and paying most of it out in dividends,” said Tom Jones, head of policy and public affairs at Thompsons Solicitors.
“When the government introduced legislation to reduce access to justice for injured motorists, we were told by the insurers that we would see premiums fall. But now Admiral is predicting more premium increases this year as it seeks to maximise profit from this captive market.
“The truth is that the insurers exaggerated the problem of fraud to secure legal changes and now they’re reaping the benefits through what they themselves are calling an ‘excellent’ claims environment – excellent for them!
“It’s time they did the decent thing and cut premiums. It’s also time politicians stopped listening to insurers and started taking action to fix this broken market.”
Admiral chief executive Henry Englehardt recently told shareholders we have been able to increase profits ‘largely due to excellent claims experience’.