Zurich cuts staff; business rates fall
Zurich Financial Services AG said Friday it will eliminate about 400 jobs nationwide as prices for commercial insurance decline.
The cuts amount to around 4 percent of the staff at the division selling coverage to businesses. The job reductions will allow the Schaumburg-based unit to grow profitably, the company said Friday.
Zurich's North America Commercial business division has about 10,500 employees working in 110 offices and remotely across the U.S. and Canada, spokesman Keith Owens said.
"The reductions in staff will be across NAC's entire U.S. operation, not just Schaumburg or the Chicago area," said Owens. He declined to provide specific numbers by location.
He said the Schaumburg office has about 2,200 employees, with another 500 in the Chicago area.
Insurance rates for large commercial accounts fell 8 percent to 10 percent in late 2007 and early 2008 as companies competed for market share, Standard & Poor's said in a report this week.
Even without further price drops, the industry's claims and expenses will nearly equal premiums collected -- and exceed them for some types of business -- assuming normal losses from catastrophes, the rating company said.
Insurers lowered prices for coverage of factories, airplanes and workers' compensation last year after record profits in 2006.