@Marcus Heimstad , Thanks for posting in Q&A.
Based on my testing, I find if I add group under Remove (update). it will only remove the same group from the local administrators group. The user in the group will still be kept。 The same result as yours.
Therefore, if currently it is the user we want to remove from local administrators group, we need to add the user under remove(update). Or we can also consider the Add (Replace) action. It replaces the members of the selected groups with the new members you specify for this action.
https://learn.microsoft.com/en-us/mem/intune/protect/endpoint-security-account-protection-policy#configure-the-profile
However, if the existing option didn't meet your requirement, you can try to feedback to Intune uservoice to improve the feature.
https://feedbackportal.microsoft.com/feedback/forum/ef1d6d38-fd1b-ec11-b6e7-0022481f8472
Thanks for your understanding.
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