New York-based insurer MetLife has eliminated the jobs of 2,500 advisers, representing a third of total, in a bid to save operational cost and make the company more productive.
Other reasons of the job cuts as dictated by the company include reduced sales of variable annuity products and seeking other markets for business growth.
MetLife US retail business head Eric Steigerwalt was quoted by Bloomberg as saying that the company currently has 5,000 advisers, which was 7,500 in February of 2012 and its number of agencies has also decreased to 60 from 85.
"We’re not financing advisers who, frankly, were never going to make it in this business," Steigerwalt said.
"Our productivity is way up and we’re saving a lot of money."
The insurer said that its US operations will contribute 60% in cost savings out of a total target of $600m, and the same will be invested in business development in emerging markets, including Chile and Turkey.
The firm, compelled by the declining rate of interest, has decided to sell only $11bn of variable annuity products in 2013, compared to $28.4bn in 2011.
In a bid to reduce dependency on agencies for the distribution of insurance products, the US life insurer has employed alternative distribution methods, inducing website promoted sales as well as through Wal-Mart Stores.
Additionally, approximately 2,600 employees are being relocated by the insurer to North Carolina, including 1,300 in Steigerwalt’s US retail unit.