Insurer seeking to more than double its original £100m cost-saving target
Direct Line Group plans to make another 2,000 jobs redundant as part of its cost-cutting drive.
The resulting savings will allow Direct Line to more than double the £100m of annual costs savings it was targeting by 2014.
The employees who could be affected by the cuts are mostly employed in roles across head office and support functions, the insurer said. It added that it had begun consultation with staff and their representative bodies.
The company said in a statement. “Direct Line Group will maintain employee consultation throughout the process, while aiming to mitigate the impact of staff redundancy through redeployment and identifying opportunities with other potential employers.
“The group has first-hand experience of successful staff redeployment and will do its utmost to assist those affected in seeking new employment opportunities.”
Direct Line Group revealed on 3 August last year that it was targeting £100m of gross cost savings by 2014. It is now targeting £130m of net savings annually, and says the gross savings will now be more than twice the initial £100m target.
The total cost-cutting drive will result in one-off costs of £180m, up from the original amount of £100m.
Direct Line Group chief executive Paul Geddes said: “This is another step in the ongoing transformation of Direct Line Group and an important part of our aim to regain competitive edge.
“While we continue to invest in the business with the aim of winning in a market that is changing fast, it’s clear that we need to become more efficient to deliver the good service and value our customers expect.
“We have not made these proposed changes lightly and understand the impact they will have on our people. As we have done in the past, we will deal fairly and carefully with those impacted, and do all we can to support them through these changes.”
source: www.insurancetimes.co.uk