Of the 3,800 layoffs announced by the Allstate Corporation on Tuesday, about 1,000 are related to refunds customers received during pandemic shutdowns, the Wall Street Journal reports.

Of the 3,800 layoffs announced by the Allstate Corporation on Tuesday, about 1,000 are related to refunds customers received during pandemic shutdowns, the Wall Street Journal reports.

Nam Y. Huh/Associated Press

Of the 3,800 layoffs announced by the Allstate Corporation on Tuesday, about 1,000 are related to refunds customers received during pandemic shutdowns, the Wall Street Journal reports.

Allstate said in a press release that it would implement a multi-year restructuring plan that includes job cuts for employees in claims, sales, service and support roles.

From Logan Moore of the Wall Street Journal:

“Of the job cuts, about 1,000 are tied to the company’s pandemic-related refunds to policyholders, Allstate Chief Executive Thomas Wilson said in an interview.

Those refunds were driven by a sharp decline in driving by car owners amid government-order shutdowns and fear of Covid-19, especially in the early months of the pandemic. Many insurers reduced customers’ bills as claims volume fell.”

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Allstate stated it expects to incur about $210 million, pre-tax, in severance and employee benefits, plus real estate exit costs of about $80 million, pre-tax, from office closures. The plan includes merging Esurance and Allstate operations.

In the press release, Wilson said the restructuring plan is “necessary to provide customers the best value.”

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