Insurer Allstate to cut nearly 8% of workforce under restructuring plan

(Reuters) - U.S. insurer Allstate Corp ALL.N said on Wednesday it would cut about 3,800 jobs, or nearly 8% of its workforce, as part of a multi-year restructuring plan.

The firm said it expects to incur a pre-tax charge of $290 million as part of the restructuring, with $210 million to $220 million expected to be recognized in the third quarter.

Additionally, office closures have led the insurer to flag pre-tax real estate exit costs of about $80 million.

Allstate said it expects the charges to impact both net income and adjusted net income, with severance and employee benefits accounting for most of the primary costs.

“Implementing this plan is difficult as we still deal with the impact of the pandemic but necessary to provide customers the best value,” Chief Executive Officer Tom Wilson said in a statement.

Prolonged low interest rates would also impact third-quarter earnings, the insurer added.

Allstate had nearly 45,780 full-time employees and 510 part-time employees at the end of last year, according to a filing.

Reporting by Abhishek Manikandan in Bengaluru; Editing by Sriraj Kalluvila and Devika Syamnath