More job cuts, price hikes on cards for insurers
More job losses and motor premium hikes are likely in the insurance sector in the wake of a large number of layoffs at Liberty Insurance.
US-owned Liberty is laying off 270 people from its operations in Blachardstown in Dublin, Cavan and Enniskillen in Co Fermanagh.
The company expects 135 of the redundancies to be in Dublin, 115 in Cavan and 20 in Enniskillen.
The job losses will be voluntary, and staff will be offered four weeks' pay for every year of service in addition to statutory redundancy.
However, the insurer warned that the final numbers to be made redundant were still "uncertain" at this stage. Liberty employs 950 people in Ireland.
A spokesman for the company said the layoffs were due to the fact it is closing its UK retail insurance arm, which is serviced from Ireland.
Liberty plans to outsource the Co Fermanagh call centre.
It denied that the layoffs are due to under-reserving on the motor side of its business in Ireland. Most motor insurers in the market are losing money, and have been hiking premiums.
The latest official figures show motor premiums rose by 16pc in the last year.
Liberty bought the old Quinn Insurance business four years ago, and a year later bought the British retail business from the administrators of the Quinn Group. But UK insurance division has been loss making, a spokesman for Liberty said.
Chief executive of the Irish Brokers Association Ciaran Phelan said he expects motor premiums to keep rising across the insurance sector.
And he said it was not possible to rule out more job losses in the insurance market.
"There is no doubt that premiums will keep going up across all insurers, and more job losses across the industry cannot be ruled out," he said.
It comes after rival RSA was said by its unions to be making 200 people redundant.
And domestically-owned FBD has issued a number of profit warnings.
Motor insurers collectively lost €195.4m in 2013, according to the Central Bank.
Liberty is a huge US mutually-owned insurance group based in Boston. It bought the old Quinn Insurance for €1 from court-appointed administrators in 2011, but also took on some of its debts.
There is a 2pc levy on all general insurance policies to cover multi-billion euro losses racked up by Quinn Insurance.
The then Quinn Insurance laid off 900 people in 2010, when it had 2,700 workers.
New owner Liberty made 285 people redundant in 2012.
It said it was staying in the Irish market.
Liberty international president Luis Bonell said: "Liberty Mutual remains fully committed to building a successful business in Ireland."