Direct Line bosses head for exit door as it looks for £100m cuts
INSURANCE giant Direct Line is axing 70 senior roles in an effort to meet a pledge to cut £100 million in costs.
The insurer, part owned by Royal Bank of Scotland, said the move would reduce costs in its central functions and would result in the closure of its office in Teesside.
Executives who have “decided to leave” the organisation include chief operating officer Jonathan Davidson, a high-flying former partner at consultancy McKinsey and a Harvard MBA graduate. He took over the role in 2009.
Other voluntary departures include Sheree Howard, who headed the firm’s project to meet regulatory requirements under Solvency II.
A spokeswoman for the firm, whose headquarters are in Bromley, Kent, confirmed that two senior members of staff based in Scotland are also leaving but declined to release their names.
The latest cuts are in addition to about 900 job losses Direct Line announced last month. The company, which operates brands including Churchill and motoring assistance group Green Flag, is trimming its workforce of about 15,000.
RBS sold a 30 per cent stake in Britain’s biggest motor insurer to stock market investors earlier this month, the first stage of a disposal demanded by European regulators for state aid the bank received in the 2008 crisis.
Chief executive Paul Geddes said the “timing is now right for us to make these changes”.
He added: “We are creating a simpler, more efficient business which costs less to run. As market leader, these changes are essential for us to succeed in a competitive market place. I don’t make these changes lightly, and we will do all we can to support those affected.”
As a result of the changes, chief information officer Angela Morrison will report directly to Geddes.
The firm added that “key elements of Solvency II activities” had been “embedded” in the finance and risk functions under Jose Vasquez, chief risk officer. The remaining elements under Davidson’s remit have been devolved to other areas of the business.
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