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NEW YORK (AP) — Farmers Insurance said Monday it will lay off 11% of its workforce — about 2,400 employees — as part of a corporate restructuring aimed at increasing its efficiency and long-term profitability.
The California-based insurer said the job cuts will impact all lines of its business. Monday was the last working day at the company for most employees impacted by the layoffs, Farmers confirmed to The Associated Press.
In a statement announcing the job cuts, Raul Vargas, president and CEO of Farmers Group Inc., a subsidiary of Swiss giant Zurich Insurance Group, alluded to “existing conditions” in the insurance industry.
“As our industry continues to face macroeconomic challenges, we must carefully manage risk and prudently align our costs with our strategic plans for sustainable profitability,” Vargas said. “Our leaner structure will make us more nimble and better able to pursue opportunities for growth and ultimately make Farmers more responsive to the needs of our insured customers and agents.”
In recent months, Farmers — along with other insurers including Allstate and State Farm — have pulled back on property insurance in states like Florida and California. As these regions become increasingly susceptible to natural disasters, from hurricanes to wildfires, in the era of climate change, the insurers have cited the need to reduce risk exposure and operating costs — but critics have accused the companies of exacerbating the cost-of-living crisis.
Monday’s layoff announcement from Farmers follows mass job cuts seen at a handful of companies in the past year — including T-Mobile, Google, Meta, Amazon and Microsoft. Beyond the tech sector, layoffs have also hit Disney park employees, newspapers and some higher education jobs.
FAQs
NEW YORK (AP) — Farmers Insurance said Monday it will lay off 11% of its workforce — about 2,400 employees — as part of a corporate restructuring aimed at increasing its efficiency and long-term profitability. The California-based insurer said the job cuts will impact all lines of its business.
Is Farmers Insurance laying off 2400 people? ›
California-based Farmers Insurance said Monday it is laying off 11% of its workforce — or 2,400 employees — in a bid to restructure itself for long-term growth.
Is Farmers Insurance in financial trouble? ›
Implementing the revised capital model has strengthened Farmers' capital to the '99.50%' stress level. We therefore revised the outlook on Farmers to stable from negative. We also affirmed our 'A' issuer credit and financial strength ratings on Farmers and its core operating subsidiaries.
Why is Farmers Insurance laying off employees? ›
The Woodland Hills-based insurance giant said it was responding to the current state of the industry, which in recent years has been plagued by skyrocketing costs and, in some areas, unprecedented disaster risk. The company cut around 2,400 employees, including 369 who reported to the Woodland Hills headquarters.
Why are insurance companies laying off so many people? ›
GEICO eliminated 2,000 positions and Liberty Mutual cut 850 jobs. From big brands to insuretechs like Hippo that laid off roughly 20% of its employees, the cuts are undeniable. CEOs cite several drivers behind their decisions, from restructuring to improving efficiency to automation to re-evaluating product offerings.
How much do top farmers insurance agents make? ›
Farmers Insurance Agent Salary in California
| Annual Salary | Weekly Pay |
|---|
| Top Earners | $98,197 | $1,888 |
| 75th Percentile | $76,000 | $1,461 |
| Average | $58,781 | $1,130 |
| 25th Percentile | $43,900 | $844 |
Farmers is so expensive because of agent commissions and rising costs overall for insurance companies. At $1,044 per year, the average Farmers car insurance policy is a lot more expensive than the national average of $671 per year for a policy with minimum coverage.
Is farmers insurance being downgraded? ›
Moody's has placed Farmers Insurance Group's ratings on review for downgrade, a move that reflects the rating agency's concerns around insurer's underwriting results in its core personal lines and its capital adequacy.
What company owns farmers insurance? ›
What is the financial strength rating of farmers insurance? ›
Oldwick //BestWire// - AM Best has affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a” of the members of Farmers Insurance Group (Farmers).
As part of the transaction, the Farmers Exchanges entered into a 10-year distribution agreement with MetLife to offer Farmers personal lines products on MetLife's U.S. Group Benefits platform, which reaches 3,800 employers and around 37 million employees, it said.
Why is Farmers Insurance ending Saturday? ›
The reason for this is simply down to the number of people expected to choose the NFL over the PGA Tour. Recent figures from a report in the Sports Business Journal stated telecasts relating to the NFL covered 96 of the top-100 most watched sports events in the US last year.
What do insurance companies fear the most? ›
Legitimate Denials
People have successfully fooled insurance companies into paying out for false injuries, so these insurers are often paranoid about paying out for a false claim.
Why are insurance agents so rich? ›
Insurance Agents get paid a commission (percentage of your premium) from your insurance carrier. You do not pay insurance agents directly. Instead, every time you make a premium payment, the insurance carrier pays the set commission rate to the agent or agency.
What insurance companies are laying off employees? ›
According to S&P Global, Liberty Mutual laid off around 1,200 employees, while USAA had cut 300 employees from its workforce. Other notable layoffs in the industry included those announced by personal lines insurtech Hippo and specialty MGA Hagerty.
How many people did farmers layoff? ›
Farmers Insurance has laid off 2,400 employees as the entire insurance industry grapples with increased risks and rising operating costs.
Are farmers leaving CA? ›
Farmers Auto Insurance announced it is pulling out of California. The insurance company says this shut down is to increase operational efficiency an manage risk exposure.
How many people are retiring from the insurance industry? ›
Nearly 400,000 employees are expected to retire from the insurance industry workforce within the next few years, according to the U.S. Bureau of Labor Statistics.
