Hanover Insurance Group will hand about 160 employees – around 3% of its workforce – their walking papers, the company said Wednesday.
The insurer said the job cuts will save it about $30 million in annualized pre-tax expenses. It expects to save another $20 million through unspecified “non-personnel cost reductions.”
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About half of the job cuts will take place in Worcester, Mass., according to a report by the Worcester Telegram.
Hanover reported net income of $78.4 million in the second quarter, blowing past analysts’ projections. That’s well ahead of Q2 2016’s reported net income of just $2 million. Hanover took a $56 million charge that quarter to pay off debt, according to the Telegram.
The job cuts are part of President and CEO Joseph M Zubretsky’s push to shore up the insurer’s financial position. Since taking the reins at Hanover in June 2016, Zubretsky has added $174 million to reserves as a buffer against claims, according to the Telegram. He’s also reorganized Hanover’s executive structure and gone after more lucrative business.
“These initiatives are critical to our success,” Zubretsky said. “They sharpen our organizational focus, broaden our business capabilities and create financial flexibility that enables us to reinvest in our business and increase shareholder returns.”
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