Admiral Group plc (ADM) Earnings Call Transcript & Summary

Welcome, everyone. Thank you for coming this morning. This is Admiral Group's Household -- U.K. Household and Beyond Motor deep dive. I'm introducing today's session, and then our top team will take you through the deep dive. And after that, we've got plenty of time for Q&A. So why are we doing this session today? Well, these businesses have established a track record of top line growth, reaching profitable scale, and we've just completed the integration of the More Th>n Home and Pet books, which has gone very well. We're excited about the future and believe today is a good time to share more information to help you understand more about Beyond Motor, including market dynamics, our performance, competitive advantages and why we believe we're well equipped to win in these markets. So let me give an overview first. Admiral U.K. Insurance is well placed to deliver sustainable profitable growth over the medium term, and this is driven by 3 areas of focus. First, our customer centricity, delivering great products and customer experience, especially at point of claim with strong NPS and very competitive prices. Second, Motor operational excellence, balancing growth with market-leading combined ratio performance, both benefiting from strong retention. And third, the main topic for today, Beyond Motor, also known as Household, Pet and Travel is a key driver of future growth for the group. There are 5 points to highlight. First, we have quickly gained profitable scale with top 5 positions in markets totaling GBP 11 billion. In 2025, we're seeing an inflection point with GBP 3.6 million risks and GBP 25 million profit at the half year. We're replicating our U.K. Motor operational excellence in distribution, pricing, claims and financial discipline to deliver customers great value and experience. We've established and scaled these businesses organically, but we boosted our trajectory and further strengthened our capabilities through the More Th>n acquisition. Multi is a source of additional future customers for Home, Travel and Pet, whilst also enhancing the value of Motor, contributing to market-leading retention and adding additional data for pricing. Looking ahead, there's plenty of headroom for growth, and we continue to strengthen our capabilities. Overall, we're confident that all 3 businesses can achieve top 3 market position whilst delivering market-leading combined ratios, making a meaningful contribution to group profits in the medium term. Let me introduce you to the team who are leading Home, Travel and Pet. Scott Cargill has been in Admiral for 9 years and is familiar to you as the founding CEO of Admiral Money, now a sustainable profitable business. I was delighted to welcome Scott to U.K. Insurance leadership at the start of this year. He's brought energy and a fresh perspective to Beyond Motor and to U.K. Insurance as a whole. Scott will provide an overview of Beyond Motor. Noel Summerfield, he doesn't look old enough, but he's been in Admiral for over 20 years, and he's led Household since 2013. Noel has built a strong team that is translating Admiral's strengths in pricing, claims, customer experience and cost discipline to household. Noel will give an overview of the U.K. household market and Admiral's competitive advantages. Rachel Lewis, even harder to believe that Rachel has been with us for 20 years. Rachel has worked across all areas of finance, including Group Finance Director. For the last 2 years, we've been very lucky to have Rachel as our U.K. Insurance CFO, providing financial direction to U.K. Insurance and within that, Beyond Motor. Rachel will outline financial performance, capital management and reserving for U.K. insurance Beyond Motor. Also in the audience, we've got Cosmin and Prit, who lead our Travel and Pet businesses, respectively. So let's begin. I'll pass to Scott.

Thanks, Al. Good morning, everyone. As you know, Admiral has always been a business that thrives on disciplined growth and innovation. We built our success in Motor insurance by challenging the status quo, combining top-class underwriting with an obsessive focus on customers and efficiency. Today, we're here to talk about how we've been leveraging that winning formula in our U.K. personal lines Beyond Motor. The Household, Pet and Travel businesses are part of Admiral's long-term strategy and the most meaningful of personal lines outside of Motor. Today, these 3 markets are worth around GBP 11 billion, which is just over half the size of the personal Motor market and are expected to grow to GBP 14 billion by 2030. In all 3 lines, the dominant distribution channel is price comparison and penetration rates are still rising. In Household, price comparison takes around a 75% share of new business, and we expect recent market consolidation to support pricing and margin resilience in the medium term. For Pet, price comparison now makes up 50% of new business with vet partnerships and other direct channels making up the rest. There has been an increase in pet ownership and insurance penetration since the pandemic. In Travel, price comparison has now grown to 65% penetration of new business, and it continues to take share from banking packaged accounts and other direct channels. Our ambition is best articulated with 2 clear goals: Firstly, to build independently profitable business lines, each achieving competitive advantage in their respective markets and delivering sustainable, profitable growth over the medium term. Secondly, to contribute to the wider U.K. business by adding more customers and increasing customer loyalty. All 3 businesses are well run in attractive markets with strong leadership teams and are making solid progress. Although at different stages of development, they all evidence capabilities, which give some competitive advantage in their respective markets. While each business has its own strategy, specific for those markets, a few elements are either shared or reinforced as being part of the whole. Starting with distribution. Leveraging our market-leading price comparison expertise and our ability to deliver the right price for customers, we already now have scale and trust across all 3 lines. Millions of households across the U.K. know Admiral is a fair, transparent and dependable brand. Our multiproduct ecosystem gives us access to customers who already trust us with their cars and who are natural candidates for home, travel and pet protection. Moving to our deep capability in pricing and claims. The analytics and digital infrastructure that underpin our Motor success can be directly leveraged in these lines. Our ability to interpret data, respond to emerging risks and refine underwriting in real time give us a clear competitive edge in a market where precision and speed increasingly define the winners. And finishing with scale and shared capabilities. These include Admiral's customer operations, our technology expertise and our overall talent pool. Admiral has a culture that executes. Our unique balance of entrepreneurial autonomy and disciplined capital management has driven market-leading performance for more than 2 decades, and this same mindset is being applied to our Beyond Motor business lines. At the end of H1 '25, we have achieved scale in all 3 markets. Household is our most mature business and has averaged around a 30% CAGR since launch. We underwrite 2.1 million risks and generated just under GBP 500 million in GWP in 2024. Travel has delivered strong growth with over 50% CAGR since launch. Today, we underwrite 1.1 million risks and generate close to GBP 60 million premium in the first half of 2025. And finally, Pet is fast growing and close to breakeven. It is growing at a 5x CAGR since launching in 2022. So in total, we now have 3.6 million customers, which generated over GBP 700 million of GWP in the 12 months to June '25. We are establishing a significant share of direct markets and are a top 5 player already with the ambition to be a top 3 player with market shares of at least 10% in all 3 lines in the medium term. Our combined ratios across all businesses are performing well. And as Alistair mentioned, we see 2025 as an inflection point. Having delivered record H1 profit with our proven approach of scaling selectively and profitably, there remains significant opportunity for organic growth, both in price comparison and in multi- opportunities with the rest of the U.K. Motor customer base. Moving now to talk about our first acquisition. This was the RSA More Th>n deal, which is now completed. This was a renewal rights acquisition for GBP 83 million, chosen for its strong strategic fit, low risk and cultural alignment. The delivery was smooth, on time and on budget. We onboarded 300 new colleagues in April '24 and successfully migrated around 380,000 risks adding over just over GBP 100 million of GWP by August '25. The deal accelerated our Pet business by around 3 years and accounted for 2/3 of Household growth from July '24 to July '25. Year 1 conversion met our plan and early year 2 retention is exceeding expectations. Loss ratios are also strong across both lines. Beyond growth, the deal expanded our capabilities, providing broader data for pricing, enabling in-house claims processing for Pet and given us the option to use the More Th>n brand. It also brought operational synergies and further expertise in household. We're pleased with this deal structure and see it as a strong template for future growth. Moving to the risk and regulatory landscape, where Admiral businesses have been and remain in a strong position. Our focus in Admiral is always on good outcomes and driving value for customers. In the past few years, we have proactively made a lot of improvements throughout our customer journeys and have adapted to changes in general insurance pricing and the consumer duty. As you might expect, we've been engaging closely with the FCA on the household and travel claims handling review and closely monitoring the CMA review of the veterinary sector. We have had positive engagement with the FCA on both the market review and the themes highlighted in the Which? super-complaint. We are very confident on our internal processes and procedure, which monitor customer outcomes. This is evidenced by over 85% of household customers confirming they are likely to renew us after a claim contributing to 2 to 3 basis point advantage over market on retention. In summary, when we set our strategy for Home, Pet and Travel lines, we identified key ingredients to replicate our Motor success, distribution, operational excellence, risk selection, award-winning customer service, combined with an efficient use of capital. Over the past few years, we've made solid progress in all. We believe that by doing for Homes, Pet and Travel, what we did for cars, Admiral can build a top-tier insurance franchise in these lines, one that captures meaningful market share, generates superior returns and strengthens our position as one of the U.K.'s most trusted personal lines. Now with established scale, I'm delighted to see strong progress in leveraging the strength of our Beyond Motor businesses to provide sustainable competitive advantage back into Motor. As Al and Milena have highlighted in the past, customers with multiple products are more than the sum of their parts. The most significant benefit is retention, where we see more than a 5-point improvement versus single risk customers in Motor. This creates a virtuous cycle of better insights, more data, improved pricing and ultimately, a stronger customer experience. Our recent investments to bring our U.K. lines closer together mark the start of an exciting phase where we aim to meet more insurance needs for the 5 million U.K. insurance customers who currently have just one product with us. With that, I'll hand over to Noel to talk in more detail about our home insurance business.

Thanks, Scott. Good morning, everyone. I'm Noel Summerfield, Household Director, and I was part of the team that launched Household, which I've been leading since 2013. We started Household with the aim of mirroring the success of our amazing Motor business. Today, I'll share how we are very much on the right path to achieving that ambition. We're performing well versus our peers, thanks to a winning formula underpinned by excellence in pricing and claims. I'll start off by looking at the market. Price comparison has become the dominant channel for about 3/4 of new business sales, as you can see on the left-hand side, mirroring Motor, but with penetration lagging by around 5 years. As Scott has already mentioned, price comparison is a channel we know and understand very well. And it's been a catalyst for us to grow to become a top 5 insurer by premium in just over a decade. Up until 2023, market average premiums were in decline, fueled by growing brands like Admiral taking market share through that growing price comparison channel. This trend resulted in a drop in market profitability. This was made worse in 2022 following the introduction of the GI pricing practices, high claims inflation and as some of you might remember, a rather large freeze event. A market correction followed with rate increases through 2023 and 2024 with the market now standing at around GBP 8 billion GWP. Transferring the fundamentals from our Motor business has allowed us to continue growing during this challenging period. One of the core fundamentals we stick to is discipline in pricing and claims. Whilst remaining disciplined, we've been the largest seller of new business for several years with around 1/3 of sales coming from our existing Motor customers in the form of multicover. It also helps that we've got a great brand. Admiral is a top 3 home insurance brand for spontaneous awareness and consideration, which helps boost conversion. We provide great customer service with NPS above 50 and happy customers stay longer, which is shown by our higher-than-market retention rates. All of this has allowed us to grow to over 2.1 million customers. And at the same time, we've outperformed the market on combined ratio by an average of 6 points over the last 5 years. I think about the Household business in 4 areas: Risk selection and pricing, cost management, customer and risk. Firstly, risk selection and pricing. We cover a broad range of customer needs, including nonstandard features such as listed buildings, unusual construction and business use. To do this, we ask lots of extra questions, consume lots of third-party data, and we can deploy rate changes very rapidly. More on all of this in a second. The next fundamental of our Household business is our approach to managing cost. We have a very strong expense ratio, which is about half that of the market average, which has been achieved by distribution through price comparison and cross-sell, strong digital capabilities throughout the life cycle of the policy. And we have a lower claims handling cost per policy helped by settling claims faster. Moving on to customer. We use data to assess the performance of our products and benchmark them regularly. These insights have driven recent enhancements, including increasing coverage and reducing excesses. Great customer service has been fundamental to Admiral's success, and it's no different in Household, particularly at point of claim. Our streamlined claims processes mean that we engage with more customers. This, in turn, means more insight into areas customers find challenging, which leads to us making further improvements. Finally, risk management. We use multiple flood assessment models and are active participants in the Flood Re scheme. This leads to great underwriting, which has translated into more than a 30% reduction in modeled flood losses compared to peers. We purchase excess of loss annually and have proportional reinsurance in place, too, which Rachel will cover in more detail later. This combined approach of providing competitive prices to a broad range of customers, being there for them when they need us most and listening and using that feedback to drive improvement is why our Trustpilot score is over 4.5 and retention is high even after a claim. Now look at pricing in a bit more detail. So I mentioned already that pricing and risk selection has been a competitive advantage of Admirals. The Household approach mirrors that of Motor using similar techniques, technology, processes and approach to data. We cover a broad range of customer needs, including nonstandard risks with our quote footprint one of the most generous in the market, returning a price for around 85% of quotes. We do this by asking extra questions so that we really understand the risk in more detail and can price it appropriately. Like Motor, there's a desire to have as much high-quality data as possible and to use it creatively. For example, instead of taking a score from a third-party vendor, we prefer to get the raw data. We might segment it differently or apply extra steps to improve it before deploying it into our models. Over the past few years, we've been going through a bit of an evolution in our pricing. All of our pricing is now underpinned by data science machine learning models. This has allowed us to capture more correlations in the data whilst preserving human intuition so that the output is fully understood. This hybrid approach is also very agile. Pricing tech is ring-fenced, so we don't have to compete with other IT requests, and this allows us to make changes very rapidly. For example, it's not uncommon for rate changes to be approved and deployed on the same day, again, common with Motor. Our approach to pricing for weather and the threat of climate change is prudent. We take past market experience and blend that with our own learning over the last 13 years. We then add margin to account for the threat of climate change, resulting in more frequent and more severe weather losses. In summary, this data-led rigorous approach has enabled us to improve our loss ratios through a period of rapid growth. It also means we can remain disciplined during more volatile periods of market rating, keeping medium-term targets in mind, again, common with Motor. Moving on to claims, the moment of truth for our customers. Similar to pricing in claims, we are learning and leveraging the best parts of our Motor business, whilst recognizing the nuances of the home insurance market. Firstly, over 1/3 of our claims are registered online with this number increasing during periods of search. We use the same claims administration system as Motor, which means in those periods of surge, pretrained Motor agents can seamlessly transfer to ensure customer service is maintained. This extra capacity, coupled with these efficient digital journeys is critical, ensuring that we can be there for our customers when they need us most. I want to share 2 quick examples with you. In storm Éowyn, in February, we had about a month's worth of claims over the course of the weekend with call answer rates remaining above 95% throughout. And a great nonsurge example is our ability for customers to register claims digitally, go through automated checks like fraud before having their claim fulfilled all without human intervention. A recent example of a claim was settled in less than 20 minutes end-to-end. Speed to register claims is also critical. We register claims from storm events 30% quicker than peers according to independent benchmarking, which means we can triage claims and secure finite supplier capacity quicker. Being front of queue has helped us settle claims 12% faster than the market. This drives good customer outcomes and lower cost. We have a longstanding relationship with our supply chain. As we've grown, we've supplemented that by strengthening our capabilities with experienced in-house loss adjusters and surveyors. This blended approach gives us more flexibility and is one of the reasons we've seen weather losses being around half that of the market average. We register claims from storm events 30% quicker than peers according to independent benchmarking -- sorry, beg your pardon. So home insurance is the second largest personal lines market with room to keep growing. We're making great progress in Household, and we're already a top 5 player, as mentioned. And we're on the right trajectory to achieve our ambition of replicating our very, very successful Motor business. We already sell more new business than anyone else due to great risk selection and pricing. We offer great value products and provide great service with customer retention higher than peers. And we have a market-leading expense ratio with AI initiatives in operations, claims and underwriting underway. This gives us confidence of increasing the gap further to support our improving combined ratio. Finally, we'll continue to grow through a combination of remaining price competitive on a price comparison channel, which is growing and cross-selling to our Motor book. I'll now hand over to Rachel to go into more detail on the financials.

Thank you, Noel. Good morning, everyone. Let's now take a look at the financials, where we show robust growth, strong underwriting, prudent reserving and highly efficient use of capital, delivering great results today whilst laying the foundation for scalable success. Beyond Motor is building momentum by replicating Motor's proven winning formula. Beyond Motor has scaled efficiently over the past 5 years. Turnover has grown at a CAGR of close to 30%, while customers, that's households and pets insured and annual travel customers increased by 23%, a strong trajectory achieved without compromising underwriting discipline. All 3 businesses have or are expected to for Pet, reached breakeven within 5 years of launch. Household took just 3 years following its launch in 2012. Our initial investment in that period reduced through use of reinsurance. More on that later. Indeed, as Noel has said, since 2020, Household has consistently outperformed the market on reported combined ratio by around 5 to 6 points on average until 2023, with that advantage increasing in recent periods. This is an advantage that we expect to sustain over time as the business continues to deliver. While significant weather events impacted the combined ratio for both Admiral and the markets in 2022, the business has delivered a material improvement since then, reporting 77% and 84% in 2024 and half year '25, respectively. Diving deeper into the financials for Household, the largest, most established Beyond Motor business, starting with reserving. We believe an important factor in delivering sustainable profit growth over time is a conservative approach to reserving. Household claims are shorter tail than Motor claims with average duration of less than 1 year. This means lower reserve volatility and smaller discounting benefits compared to Motor, where longer-tail bodily injury claims and PPOs mean the average duration is 3 to 4 years. A cautious approach to setting best estimate reserves as well as holding risk adjustments at the upper end of the 85th to 95th percentile corridor has meant that prior period releases have been a feature of the reported loss ratio, albeit at a mid-single-digit average, a lower proportion of premium than for Motor. Weather volatility is also naturally a driver of the Household loss ratio and profitability. A total weather allowance or budget reflected in pricing is reviewed and updated on a regular basis. Currently set at around 20 loss ratio points, it reflects historic market experience, our own data and allowances for future increases in the frequency and severity of weather events. The table shows the cost of weather since 2023 has been modestly favorable to this long-term average expectation following the adverse weather impacts in 2022. To repeat Noel's message, we are well positioned for climate change, embedding climate considerations into our modeling, updating these regularly and ensuring resilience as weather patterns change. When normalizing for weather volatility, the current period loss ratio has improved steadily, reflecting a disciplined pricing response to inflationary trends, improved risk selection and strong operational execution. The expense ratio is also improving, benefiting from higher premiums, increased scale and the usual Admiral cost discipline. It's nearly half the average market level. As a result, the reported combined ratio shows strong improvement with 2024 a standout year at 77%. Of course, benefiting from benign weather and prior period releases, but evidence of the ability of the business to deliver both strong growth and profitability at the same time. One of the key enablers of growth has been a capital-light structure. For household, that means smart use of both proportional and nonproportional reinsurance, providing significant capital efficiency, volatility management and flexibility to support sustainable growth, very much in line with the approach that has been so successful for Motor. Nonproportional reinsurance is in the form of excess of loss cover, providing protection against catastrophic weather events. And in recent years, the cover kicks in for around 1 in 10-year events. On the proportional side, quota share contracts with longstanding reinsurance partners cover 70% of the book. Contracts are multiyear and are in place until at least 2027 with deals having improved over time as the household track record has strengthened. The contracts provide for a proportional sharing of premiums and other revenue, claims and expenses with Admiral benefiting from profit commission, incentivizing profitable growth. Generally, for profitable underwriting years, profit commission emerges over a number of financial years. In the unprofitable underwriting year scenario, recoveries from quota share partners are recognized upfront and then adjust as the underwriting year develops. In some scenarios, cumulative losses for quota share partners may delay profit commission recognition in future profitable years. Quota share has allowed the business to break even with limited investment. It has also provided some smoothing of volatility in the gross Household underwriting results, dampening the impact of adverse weather in 2022 and then enabling Admiral to earn an increasing share of the profits on the ceded portion of the book in 2024 and '25. Ultimately, the primary goal of the Household reinsurance strategy is disciplined capital allocation, targeting at scale returns on capital in line with the group's historic averages. Reinsurance is optimized to deliver maximum capital efficiency on the current capital measurement basis, the standard formula. This combination of proportional and nonproportional reinsurance for household results in a material reduction in the solvency capital requirement. For Travel and Pet, the approach is different. We buy excess of loss reinsurance for Travel, providing protection against significant medical losses and catastrophic events. We don't buy reinsurance for Pet. As we transition to the internal capital model, we'll continue to regularly review reinsurance strategy to ensure that we continue to optimize capital efficiency and can leverage capital benefits such as diversification as the Beyond Motor businesses scale. Now to revisit what all of this means for the bottom line. Beyond Motor has delivered a positive profit contribution to the group since 2023 with a strongly improving trajectory over the past 3 years, partly helped by benign weather and quota share profit commission. We have already called out 2025 as an inflection point. Record profits in the first half with near-term expectations of Pet reaching breakeven and continuing growth in profits for Beyond Motor in general, subject, of course, to weather volatility. Alistair and Scott have already stated our ambition to be a top 3 player in these markets, aiming for market shares of at least 10%. We will maintain focus on underwriting discipline, aiming to deliver market-leading combined ratios in the 80% to 90% range. Combined with continued contributions from other revenues and investment income, we expect this to mean margins in the mid-teens, once again, subject to weather volatility. We are confident that this will see Beyond Motor contributing meaningfully to group profits in the medium term. So as I've shared with you, Beyond Motor has proven it has the ability to scale efficiently and take advantage of market conditions, leveraging the Motor winning formula of combined ratio outperformance, conservative reserving and smart use of reinsurance for volatility management and a capital-light structure. Going forward, it's all about discipline and execution to grow scale and profits, and we are committed to getting all 3 businesses delivering high returns on capital as they do this, which means attractive returns and long-term value creation for shareholders. Now back to Alistair to wrap up.

Thank you, Rachel. Okay. To summarize, today, we've provided insight into U.K. Household and Beyond Motor. We've shown that. We have quickly gained profitable scale with top 5 positions in markets with good growth prospects. We are replicating Admiral U.K.'s Motor operational excellence and financial discipline and are building a track record of outperformance and good customer outcomes for customers strengthening our position as one of the most trusted U.K. personal lines insurers. Multi is a source of additional future customers for Home, Travel and Pet whilst enhancing Motor value by contributing to market-leading Motor retention and adding data for Motor pricing. There's plenty of headroom for growth. We continue to strengthen our capabilities in pricing, claims, customer experience and efficiency. To conclude, Admiral Home, Travel and Pet operate in markets that currently total around GBP 11 billion. We're confident that in the medium term, each can achieve a top 3 market position whilst delivering market-leading combined ratios, equating to a market share of at least 10% with margins in the mid-teens.

Okay. So let's open to questions. What we'll do is we'll do the room first. If you can ask 2 or 3 questions each and the microphones are in the seat in front of you and you need to hold the button down, I think, to talk. Ben, you were first.

I'm Ben Cohen at RBC. Could I ask really 2 things, I guess, on home pricing trends and also what you're seeing in terms of competitive behavior in the industry. It looks like certainly you're coming from some very good levels of profitability. I guess the market has also seen profitability improve. Kind of how are you sort of making your way through, I guess, what seems like a more competitive environment? And any view in terms of when and how pricing will improve in that market?

Noel, are you happy to take that one?

Yes, sure. And -- so I think you're right. So prices have softened. I think we mentioned at the half year that we expected them to soften in H2, and they have perhaps a little bit more than we were expecting. Household hasn't typically been cyclical as a market, but there may be signs with more rational players taking up bigger share that, that might happen going forward. I think maybe a weather event or something might stimulate price increases. But for Admiral, as you'd expect, we remain disciplined with our approach to pricing with the medium term in mind.

Yes. So from a market perspective in Home, we're seeing prices sort of continued down, like we said at the half year, we're seeing that trend continue, and we're being more disciplined similar to what we do in Motor. We think about claims costs first and then manage market conditions according to optimizing value in the medium to longer term.

Could I ask a follow-on just in terms of the kind of technology investment that you've made? I'm not quite sure sort of what is kind of best-in-class systems in terms of, I guess, claims handling, but also on the front end. Could you maybe say something about how much -- what you have done is sort of unique to Admiral, how much you're sort of able to benchmark yourself against some of your peers in terms of the kind of the whole tech stack?

Let me take that one, and I'll see if others want to add. So in terms of our overall tech strategy, we use -- for Motor and Home, we use Guidewire as a system of record as a claims system. Where we are quite differentiated from the market is in terms of what we do on data and digital. So in terms of data, we use Google Cloud platform. As Noel mentioned, we collect lots of data there. We've got a rich history of data. We use a lot of machine learning models, and that's really where it's very bespoke. Similarly, on digital, we build more of our own journeys. Maybe, Scott, you could elaborate a little bit more in terms of Beyond Motor as a whole.

Yes. And I think something I would add is that we've tried to think about certain micro services for areas where we think we can have differentiation, and we connect out to third-party data sources or different third-party tech to, for example, allow a customer to take photographs or provide a video at a claim stage, and that's automatically brought into our claim system. So as I said, Guidewire is a core, but then differentiation is created through certain third-party platforms that we connect to.

Darius Satkauskas, KBW. Two questions, please. So I think you showcased that the combined ratio gap between you and the market is 5 to 6 points, I believe, since in the last 6 years or so. What would it be if you were to adjust for your insurance strategy? I'm just thinking what kind of headwind in terms of combined ratio points does your insurance strategy result in? And the second question is, when you do buy reinsurance for Household, does having a strong Motor franchise help here? And are you able to quantify, how do negotiations generally work for Household specifically when it comes to insurance purchasing?

Rachel, are you happy to take those two?

Yes, I'm happy to take those two. So when we quote combined ratios, they are reported combined ratios. They're after excess of loss reinsurance, but they don't include the impact of the proportional reinsurance or quota share. So no impact from that. And then you can assume, I mentioned the level of cover that the excess of loss attaches at. And that would -- those costs would be in that reported combined ratio. And I think that would be the same for others in the market. So no impact of reinsurance on those numbers that I gave. And then in terms of the strong sort of Motor franchise, yes, I mentioned in the presentation that we've got longstanding relationships with strong reinsurance partners across all of our businesses. I think we enter those negotiations and conversations in a very similar way. We've seen the terms of the household in particular, improve as the business has strengthened its track record. So there's strong comparison and similarity there.

Amalie here from Deutsche Bank. Just 2 questions, if that's okay. So you spoke a lot about multi-holding and how it's more profitable and how -- or at least how it's higher retention. I mean just remind us, do you have any sort of specific targets in terms of multi-holding in terms of sort of the wider business and also now with Beyond Motor? And then on sort of weather claims, I mean, you spoke a bit about how they're a big contributor to the combined ratio. What are you doing in terms of sort of prevention and long-term sort of lowering of these weather-related claims? I mean, are you giving people sort of -- yes, how are you helping households sort of keep those claims down going forward in the sort of long term?

Okay. I'll take the first one and then Noel, if you're happy to take the second one. So in terms of multi-holding, it's an area where we've got 20% of our customers overall have multi. If you look at our Motor book, for example, over half of them are auto homeowners. And then on top of that, you have renters. So there's plenty of opportunity to go at, and that's something that through continuous improvement, we've got things like QuickQuote where you can use the data from motor, 5 questions, you can get a home insurance quote, we're driving that through. We haven't set out specific targets. I think at the full year, we disclosed 1.3 million multi-customers and at the half year, 1.5 million, so you can get a sense of some trajectory from those numbers. Noel?

Yes, sure. So in terms of pricing and underwriting for weather, first of all, lots of data. So I think our underwriting approach is reasonably prudent. We are big users of the Flood Re scheme. We participate in things like Build Back Better as well. And then Rachel has already talked about how our reinsurance strategy also reduces and supports that prudent approach. So I think it's really a combination of those things. But first and foremost, from an underwriting and pricing point of view, it's around great data and how you use that data.

Thomas Bateman from Mediobanca. Firstly, thanks, great presentation. It really show that you are streets ahead of the presentation. Now you've been able to grow these business lines from scratch and be ahead of everyone else is amazing. When you say you contribute meaningfully to group profits, what does that mean? Can you try and put a little bit more color around that in terms of percentage and nominal amount? Second question is just on the Which? super-complaint. It's good to hear that you're engaging well with the FCA, but I see a real disconnect between what customers and Which? are saying and versus what the industry is saying. So what do you think the problem is here? What do you think the FCA might say when they respond to Which? And then finally, I'm picking one of my questions. Is there any update on the additional payment to More Th>n based on the renewals? I think you said that renewals were slightly ahead of expectations. So could you pay any more than the GBP 83 million you've already paid?

Great. I'll take the first one. And then, Scott, if you're happy to take the next 2. So in terms of contribute meaningfully, we've outlined in the presentation the size of the market. It's currently about GBP 11 billion, and we see growth. We've outlined that we feel confident in achieving top 3 market positions, which is at least 10% market share. And we've talked about the combined ratio range of 80% to 90% with investment income, other revenue takes you sort of mid-teens margins. That's basically the information that we're going to give that we think helps you understand our aspirations in these markets. We don't -- we've never given targets and we don't want to give targets. And that's for good reason, the flexibility that we have to trade through markets where conditions can vary quickly is an important part of our competitive advantage, which is why we're not going to give any more than that.

On the FCA and the super-complaint, we've been engaging closely with both. I think our understanding is that there's a wide range of feedback given to industry players at the moment. In Admiral, we do feel we're in a strong position. In terms of what the issue is, I think there's probably 2 things I would call out. There's definitely something on customer understanding. That's about how well customers engage with their home insurance, both at purchase and retention. There's a lot you can do there to improve that, and we're making a lot of efforts to improve our journeys and make sure that declarations are really strong. The second is really on claim strategy. And I'll give you a good example. One of the things that Which? have pulled out is cash settlement. And I think that really often creates bad outcomes in the market. The way we think about it in Admiral is cash settlement can be a good solution if the customer wants it. So customer choice, let them decide if they've got trades when they want to use, that works. And then underneath that, you have to make sure that if the cash doesn't cover the initial claim, you're going to be willing to reopen that. It's not full and final. And I think underneath a lot of those type of best practice examples is what Which? super-complainant in particular is trying to work for. Second question is on More Th>n. And -- yes, so the initial plan was stretching, and we've now concluded the deal and the deferred consideration really related to a very stretching upside plan, which we haven't gone ahead with.

Great. I'll go over there -- behind you, Carl, sorry.

It's Derald Goh from Jefferies. So the first one, you spoke about your retention advantage in both Motor and Home being better than the market. I think Motor is more than 5%, Home is 2% or 3%. How has that trended in the last sort of 3 to 5 years? Has that widened? Has it narrowed? And then secondly, did I hear that right, you said your home expense ratio is about half the market average. In that case, does your plan to grow policy count assume you reinvesting some of that cost advantage? Or you feel like there's enough levers for you to pull to grow without having to actually invest all those cost advantage back? Thirdly, if I may, you said that returns on capital is sort of in line for Beyond Motor as the rest of the group. Does that imply sort of the 50% ROE level? And where are you investing any incremental amount of capital today? Is it -- would you put that at Home? Would you put that in Motor? Or do you see sort of equal attractions?

Okay. So in terms of retention, Scott, are you happy to take that one? Rachel, did you want to talk about cost advantage and return on capital?

Yes, that's fine.