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Direct Line is cutting 550 jobs as its boss embarks on a £100m savings program to improve its fortunes.
The cuts, which represent 5 per cent of the beleaguered insurance company’s workforce, were announced as the group revealed it had lost 71,000 own-brand motor insurance customers in the latest quarter.
Chief executive Adam Winslow said “the direction of travel is positive” but there is still “a lot of work to do.”
Job cuts: Direct Line has revealed it had lost 71,000 own-brand motor insurance customers in the last quarter
Direct Line defended a takeover attempt by Belgian rival Ageas earlier this year and has been rolling out price increases as the cost of claims soars.
This has led to an exodus among its own-brand car insurance customers, with the total number falling to just over 3 million in the third quarter.
That’s almost 400,000 fewer than the same period a year ago, although the rate of customer departures has slowed in the latest three-month period, and other lines of business, including home insurance, have been more stable.
Total gross written premiums and other fees earned by the group in the third quarter fell 35 per cent to £705 million, from almost £1.1 billion a year earlier.
Winslow’s strategy to grow customer numbers again involves making Direct Line insurance available on price comparison websites for the first time, reversing years of resistance to the move under previous bosses.
At the same time, the company said yesterday it was moving forward with £50m of the £100m cost savings target previously announced by the chief executive, who was appointed in March.
Winslow suggested there could be further cost cuts after reaching the £100m target.
He said the job cuts announced yesterday were “not concentrated in one place but are spread relatively evenly across the organization as we look to improve the way we work”.
Bromley-based Direct Line, which also has eight other regional offices, employs around 10,000 people.
Like other large employers, it has been hit by Chancellor Rachel Reeves’ decision to increase employer pay.
Insurance contributions in a £25bn tax raid, although Winslow declined to give a figure.
“We are a relatively large employer and therefore the cost is relatively high,” Winslow said.
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