Tom Christopher Talks Employee Buyout Programs

The Christopher Group‘s Founder and CEO, Tom Christopher talks employee buyout programs with Life Annuity Specialist as insurance companies consider trying to become leaner and shift their focus into new areas.

Prudential’s Buyouts Highlight Price of Industry Transformation

….Prudential gave no hint during its conference call that unexpectedly high claims — a factor cited by insurers over the past year for lower-than-expected earnings — may have been a factor in starting its buyout program. But Christopher notes that it has been a common theme in buyouts he’s observed.

“We definitely have seen a correlation,” he says. “When insurers have lower claims, they hire more people and expand their lines of business. When claims are higher than normal, then we see more layoffs.”

Shifts in business strategy can also lead to layoffs, he said.

It’s not uncommon for an insurer to reduce their headcount in one department, and to beef it up in another, to support its digital technology initiatives, he adds.

Prudential’s buyout program may be ultimately judged on how it’s executed. Companies that are open with employees about the process enjoy positive outcomes, according to Christopher. When businesses are less than transparent in communicating program aims and timelines then employees “fill the void with speculation,” he says. That can result in reduced morale or increased turnover among remaining workers……

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