Aviva to eliminate 1,800 insurance jobs in restructuring move

The world's fifth largest insurance group, Aviva plans to eliminate between 1,500 and 1,800 jobs by 2010 as it continuesd to restructure its insurance operations that it commenced in October 2007. Aviva, which was formed through the merger of Norwich Union and CGU in 2000, said that it planned to move "to a new operating model, designed to maintain the company's position as the UK's leading insurer by improving service and driving growth", first announced last October

The company said it planned to redesign its operations functions to simplify its processes, improve customer services and the consolidation of expertise into seven centres of excellence to manage customer services, sales, claims and back office administration.

After a number of mergers and acquisitions, Noewich's operations had become complex, with too many products, processes, systems and locations, "making it difficult to give true service excellence to customers and business partners and to optimise economies of scale".

The company also said with consumers and brokers increasingly relying on online channels,  the company would be making significant changes over the next two years of transformation programme is implemented, for some of the sites in which NUI has offices as work currently carried out across widespread locations will be brought together in the seven new centres.

Accordingly, the number of roles within operations will be reduced by the end of 2010. Norwich Union Insurance currently has offices in 52 towns and cities in the UK, 22 of which will be affected by these changes. In some cases specific buildings will close, with staff moving into smaller accommodation in the same towns and cities.

Igal Mayer, chief executive of Norwich Union Insurance, said, "We are a very strong business that has grown over the years into a complex organisation. We want to deliver excellent, consistent and reliable customer service with market leading efficiency. To achieve this we will need to fundamentally simplify our business, consolidating our expertise into seven insurance centres of the future in the UK.        

While Aviva called the move "rationalisation" the Unite union described the job cuts as "brutal", saying the news for staff that their jobs are in jeopardy was "devastating".