By Ulrike Dauer
FRANKFURT--Allianz SE (ALV.XE) on Wednesday announced plans to
cut annual sales costs and to invest in digitizing its German
operations, which are the group's biggest, as the sector gears up
for fresh competition from non-traditional players such as Google
Inc.(GOOGL).
Europe's largest insurer by market value plans to reduce annual
sales cost in Germany by 40 million euros ($44.37 million) from
Jan. 1, 2016, shrinking its number of branches to 60 from the
current 88. It will also cut 360 jobs in Germany, mainly in
administration and management, equivalent to 1% of the 30,000
people it employs in its home country.
Allianz said it plans to achieve the job reduction without
compulsory redundancies and has started talks with labor
representatives. In Germany, measures such as early retirement,
part-time work and natural attrition are used to avoid compulsory
redundancies.
The cuts won't affect the insurer's 8,400 insurance agents in
Germany who will be reassigned to the remaining branches, said a
company spokesman.
Allianz also announced investment of between EUR80 million and
EUR100 million over the next three years in digitizing its German
insurance agency business. For instance, customers will be able to
contact their agents through social media such as Facebook, through
video and make online appointments.
Insurers are under pressure to update their traditional people's
business to the digital age, as online sites allow better
comparison of insurance rates and with new competition emerging
from nontraditional players. Google recently entered the e-commerce
business in auto insurance in the U.K and U.S., offering "Google
Compare For Auto Insurance" for consumers searching for car
insurance on Google's search engine.
-Write to Ulrike Dauer at ulrike.dauer@wsj.com
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