Redundancies and natural wastage to account for majority of India move

Up to 1,000 general insurance positions are set to be lost at Norwich Union (NU) following its announcement that 1,500 non-life jobs will be created in India.The current round of outsourcing by major insurers is estimated to destroy up to 3,000 general insurance industry positions in the UK. This follows previous rounds of outsourcing which have resulted in the loss of more than 3,000 further positions.A spokesman for Amicus the UK's biggest financial services union said: "We expect a rapid acceleration in offshoring within the insurance sectors. A lot of pilot schemes are reaching maturity. "Up to 50% of UK insurance jobs could eventually be lost abroad." That could mean 100,000 general insurance jobs, he explained.NU parent Aviva said it was to cut costs by transferring administration, call centre and IT functions abroad. AXA and Royal & SunAlliance (R&SA) are expected to add to the exodus within the next few weeks with the announcement of the loss of hundreds of jobs to India.Aviva's new offshoring deal will see 350 call centre jobs and 2,000 back office, administration, processing and IT jobs go to India. Though the company hopes to accommodate up to 80% of the jobs lost in the UK through expansion, redeployment and current vacancies, it does not rule out up to 500 compulsory redundancies.Aviva group chief executive Richard Harvey said: "Making decisions that will affect our staff is always tough, but by taking action to remain competitive we will secure a long-term future for our business and therefore the majority of our people."Just two weeks ago, Allianz Cornhill announced it would cut 10% of its workforce over the next two years through offshoring. This was followed by R&SA whose deal to outsource 580 IT jobs to Accenture is expected to lead to those jobs going to India. AXA UK is expected to join rivals by moving hundreds of jobs to a state-of-the-art centre it has developed in Pune. With capacity for 800 employees the new establishment could double AXA's operation in India.Industry sources say insurers can enjoy 60% cost savings by moving to India. Business administration that costs up to £30 per policy in the UK can be reduced to £10 in India.

How NU's outsourcing deal affects UK offices

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