In early January, it became known that the world’s second-largest reinsurer plans to relocate jobs primarily to India and Poland as part of an efficiency program. There are no exact figures yet, its new CEO Christoph Christoph Jurecka said
Munich Re is under pressure in its core business of insuring primary insurers against natural disasters and other major losses, as prices that were high for a long time have started to soften since last year
Munich Re: German reinsurer Munich Re is planning to reduce jobs through attrition but may turn to voluntary buyouts at its ERGO insurance unit, its new CEO Christoph Christoph Jurecka said.
Speaking to journalists on Thursday evening in Munich, Jurecka said that natural fluctuation “may possibly not be enough” for Ergo, where many routine tasks can be automated.
Munich Re aims to avoid layoffs as it plans to shift jobs to low-wage countries.
In the reinsurance division, it will be sufficient to rely on natural attrition through retirements and voluntary job changes, said Jurecka.
“There will be no job cuts beyond natural turnover.”
This rate recently stood at around ten percent per year. At primary insurance subsidiary Ergo, however, this “might not be enough,” Jurecka admitted.
Where employees cannot be retrained, severance packages on a voluntary basis will also be possible. Many routine tasks in insurance are expected to become redundant in the future through automation.
In early January, it became known that the world’s second-largest reinsurer plans to relocate jobs primarily to India and Poland as part of an efficiency program. There are no exact figures yet, Jurecka said.
In the areas affected by the plans, about ten percent of jobs are involved.
“This is not about blindly relocating jobs,” emphasized the executive, who took over as head of Munich Re on January 1. Each vacancy will be reviewed to determine if and where it should be filled. The Munich-based group employs nearly 46,000 people worldwide, about 20,000 of them in Germany.
In December, Munich Re announced savings of 600 million euros as part of its strategy through 2030, with the first 200 million targeted for 2026.
At the time, Jurecka and his predecessor Joachim Wenning did not rule out job cuts. The new CEO said that the planned savings are more about “dampening cost increases” due to inflationary effects than actual cost reductions.
Munich Re is under pressure in its core business of insuring primary insurers against natural disasters and other major losses, as prices that were high for a long time have started to soften since last year.
Insurance brokers reported declines of up to twelve percent after the contract renewal round on January 1.
“It is true that markets are becoming more challenging,” Jurecka said.
However, the figures cited do not reflect Munich Re’s experience. “Our renewal is much broader. Our numbers will look significantly different,” he said. “I would say it is still an attractive market.”
Reuters