"Reducing Aviva’s costs is essential to remain competitive and this means tough decisions and job losses which I do not take lightly."
Aviva has announced that it is splitting its life and general insurance businesses and will reduce its workforce by 1,800 as it aims to reduce expenses by £300 million per year by 2022.
Its life and GI businesses will each be managed separately, with Angela Darlington appointed as interim CEO of life and Colm Holmes appointed CEO of general insurance.
Aviva says its cost savings will be achieved through "lower central costs, savings in contractor and consultant spend, reduction in project expenditure and other efficiencies".
This will involve approximately 1,800 role reductions across the group over the next three years, out of a total workforce of around 30,000.
In a statement, Aviva said it will look to ensure that redundancies are kept to a minimum wherever possible, for example through natural turnover.
Yesterday, Aviva announced that Tom Stoddard will step down as chief financial officer and as a director of Aviva from 30 June 2019.
Jason Windsor, currently chief financial officer of Aviva UK Insurance, will become interim CFO on the 1st of July. Jason joined Aviva in 2010 and has extensive experience of the group, including as chief capital and investments officer.
Maurice Tulloch, chief executive officer, said: “Today is the first step in our plan to make Aviva simpler, more competitive and more commercial. We have strong foundations: excellent distribution, world class insurance expertise, and our balance sheet is robust.
“But there are also clear opportunities to improve. Reducing Aviva’s costs is essential to remain competitive and this means tough decisions and job losses which I do not take lightly. We will do all we can to minimise redundancies and support our people through this.
“I am also determined to crack Aviva’s complexity, an issue which has held back our performance for too long. Today’s changes will begin to reduce complexity, cost, and duplication, enabling Aviva to be better at serving our customers and delivering stronger results for our shareholders.
“The sustainability and security of our dividend is paramount. We are focused on improving our performance to grow capital generation and cash-flow."