Insurers chop jobs at U.S. offices

In the wake of dreadful third quarter results, two insurers have announced big job cuts at U.S. locations. CNA Financial says it will trim 1,850 employees, a whopping 10% of its workforce. And ING is announcing 1,600 job cuts, representing 15% of its U.S. insurance division workforce.
Amsterdam-based ING says the job cuts are the result of global economic recession and also part of its plan to integrate U.S. insurance operations the company purchased last year from Aetna and ReliaStar.
“The weak U.S. economy and difficult market conditions have challenged out efforts to reach our financial objectives,” says Fred Hubbel, a member of ING’s management board.
ING expects the job cuts to bring cost reductions between US$250-300 million a year and are part of an overall cost reduction plan which will see decreased spending on technology and other expenses.
The CNA cuts are being blamed on rising losses, including US$304 million from the September 11 terrorist attacks as well as old asbestos claims. The company plans to cut its variable life and annuity business, but will continue its p&c operations, although they will be restructured.
While the cuts will be made across the U.S., the largest portion, about 30%, will come from the company’s Chicago offices. About 101 U.S. offices will close in early 2002.