Admiral Group, the parent company of Glen Allen, Va.-based Elephant Insurance, has announced new reinsurance contracts to help expand its new auto insurance operation in the United States.

Admiral, headquartered in the United Kingdom, announced it has inked deals with Munich Re and Hannover Re to aid its direct-to-consumer provider Elephant, which opened in October 2009.

In addition to the aid to Elephant, Admiral also announced the extension of long-term coinsurance and reinsurance arrangements with Munich Re for its businesses in the UK, Spain and Italy, while an existing agreement for its German business remains in place, according to the company.

In a statement, Admiral said the partnership agreements “build further on the successful risk and profit sharing model which as been at the heart of Admiral’s success in its established UK business.”

The deal with Munich Re and Hannover Re to help Elephant began Jan. 1, with each company taking one-third of the U.S. risks and Admiral retaining one-third on its own account, according to the company.

The Hannover Re contract is for up to 10 years while the Munich Re reinsurance agreement is for up to 15 years.  Both agreements include break clauses at earlier dates and further details are “contractually confidential,” Admiral said.

Henry Engelhardt, Admiral’s chief executive, called the signing of the deals “a very good day for Admiral Group.

“These deals will help us perpetuate our model that minimizes risk and consistently produces a high return on capital,” he said in a statement. “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.”