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Daily Insurance Industry News
Sunday 21st of October 2018
February 26, 2009

RSA cuts 1,200 jobs as profits rise 13%

by Gill Montia

Story link: RSA cuts 1,200 jobs as profits rise 13%

RSA cuts 1,200 jobs as profits rise 13%

RSA has revealed plans to cut 1,200 jobs in the UK by mid-2010, as part of a cost reduction strategy aimed at making savings of £70 million.

The news comes alongside the insurer’s results for 2008, which include a 13% rise in pre-tax profit, to £759 million; net written premiums rose 11% year-on-year, to £6.5 billion.

In making the announcements the group also took the opportunity to reassure the market about its capital reserves, which are £1.7 billion above regulatory requirements.

The company also said it estimates a 30% fall in the level of the FTSE 100 from the end of last year would reduce its cash cushion by only £200 million.

RSA’s chief executive, Andy Haste, expects low interest rates and market volatility to impact on the group’s balance sheet in the months ahead and is preparing for challenging conditions.

However, he remains confident that the business can sustain its profitability.

Returning to job losses, the headcount reduction will create a one-off charge of £80 million and see the firm’s UK workforce of 8,800 reduced by approximately 14%.

Around 260 posts have already disappeared and 300 will be accounted for by normal staff turnover.

Further job losses will be countrywide and across all levels; the insurer’s main sites are located in Liverpool, London and Horsham.

 

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