In the latest development regarding rumors surrounding Liberty Mutual, the company is now confirmed to be in the process of reducing its workforce by approximately 2%, which equates to around 850 jobs in the United States. This move follows a recent trend among insurers who have announced layoffs in recent weeks.
A spokesperson from Liberty Mutual released a statement, clarifying that this decision is part of a broader company transformation initiative. They stated, “We have made the difficult decision to eliminate approximately 850 positions, nearly all in the US, across several functions this month, many of which are effective by the end of the year. Impacted employees will be eligible for severance and outplacement assistance and are encouraged to apply for other positions within the organization.”
The impact of these layoffs will be felt across various sectors of the company, affecting employees in Liberty Mutual’s US retail markets, global risk solutions business units, as well as technology and other corporate groups.
This announcement coincides with a wave of job reductions in the insurance industry, with GEICO recently announcing layoffs of 2,000 staff, equating to about 6% of its workforce. Other insurers, such as Germania Insurance and Cowbell, have also disclosed layoffs in recent weeks. Furthermore, in August, Farmers Insurance, a competitor of GEICO, cut 2,400 staff, representing approximately 11% of its workforce.
The Liberty Mutual spokesperson shed light on the company’s broader strategy, describing it as a “multi-year transformation” aimed at ensuring long-term success and addressing emerging risks. The company intends to streamline its operations for increased efficiency and effectiveness while emphasizing its commitment to delivering value to customers, agents, brokers, and partners.
Liberty Mutual had previously initiated job cuts in July as part of a business restructuring effort, reducing 370 positions across the United States. President and CEO Tim Sweeney emphasized the importance of organizational and leadership changes during the second-quarter earnings call in August. These changes are geared towards enhancing focus on strategic markets and leveraging scale advantages to achieve target profitability and sustainable success.
In terms of financial performance, Liberty Mutual Holdings reported a net loss of $585 million in the second quarter of 2023, a significant increase compared to the $343 million net loss during the same quarter in 2022. The increase in losses was attributed to elevated catastrophe losses, particularly from widespread wind and hail events in Oklahoma, Texas, and Colorado.