IAG to slash 600 jobs within three years

IAG Insurance has announced will cut 600 jobs from its CGU business over the next three years.

The expected annual savings will be $25m in 2013, increasing to $65m in 2015.

IAG managing director Mike Wilkins, says the changes to CGU’s operating model represented a logical progression in its strategy.

The strategy was overhauled in 2008 to focus on remediation and rebuilding, improving CGU’s underlying performance by about $160 million annually.

“With the work to improve the fundamentals of the business well progressed, we believe the time is right to accelerate the actions we are taking,” Wilkins says.

The roles will be cut over the next three years, CGU chief executive Peter Harmer says.

“Where possible, we will be managing the reductions in roles through natural attrition,” Harmer says. “We are very conscious of the impact that these changes will have on our employees and will be actively supporting them through this transition.

“This model simplifies our structure, making it easier for brokers and agents to deal with us and access the immense knowledge and expertise that sits within our organisation.”

IAG operates insurance businesses in Australia, New Zealand, the United Kingdom and Asia and owns many well-known insurance brands such as NRMA, SGIO, Buzz Insurance and NZI.