Staff in Admiral's Cardiff office are said to be "buzzing" after the announcement.

Some staff will receive windfalls of between �40,000 and �50,000 in the flotation.

Just under half of the company, estimated to be worth about �600m million, is owned by 900 of its staff.

Much of Admiral's recent growth has been attributed to online sales which now make up more than half its business.

The company has 1,100 staff in Cardiff and another 400 in Swansea.

Staff working for the company for more than three years will qualify.

IT systems worker Bridget Box and her husband Michael, from Barry, will both receive the windfall if the company floats.

"The place is buzzing," said Bridget, 42.

"There was a bit of disbelief at first, but a lot of smiling faces. We knew the company was doing well and they've kept us informed, now it means we can look forward to a positive future."

Bridget said she and her husband, a sales manager at Admiral, plan to buy a second car and a holiday.

"It will improve our lifestyle, we can pay off debts and put some away."

Admiral has revealed record annual profits, up 29% on the previous year, with online sales now making up half its business.

Chief executive Henry Engelhardt said the flotation was "a validation" of Admiral's successful growth and "an exciting next stage in the future development of our company".

Admiral hopes to float on the stock exchange in the autumn.

The American owns a substantial stake in the company he was hired to set up but Admiral declined to say how large.

Trading profits for 2003 stood at �71.2m, up from �55.2m a year earlier.

Strong results

The group, which has 800,000 customers, also said it had paid out a record �2.5 million to staff through profit sharing schemes.

Admiral, which sells car insurance direct to the public through its brands Admiral, Bell Direct, Diamond and elephant.co.uk, said its strong results were partly due to the growth in internet business, with more than 50% of sales now originating online.

The group said it would seek a London Stock Exchange listing in the autumn, subject to market conditions.

Overall the group gave more than 4.7 million quotes, of which 3.4 million started on the internet.

Admiral said it expected to see more than 800 million hits across all its websites this year.

The company was founded 11 years ago in south Wales and has bases in Cardiff and Swansea.