Prudential is axing its entire 1,400-strong direct salesforce, spelling the end for the traditional Man from the Pru.
The salesforce, which once numbered 10,000, is being replaced by a face-to-face financial planning service of only 250 advisers for high-net-worth clients who earn more than £50,000 a year or who have at least £50,000 to invest.
The move comes as Pru's intermediary division is merging its salesforce with Scottish Amicable to become a new distribution company called Scottish Amicable Financial Services.
The redundancies will total 2,000 from the salesforce and back-office staff. Existing Pru staff will have to apply for positions in the financial planning team.
The reorganisation will cost Pru £110m but it expects to make annual cost savings of £135m.
Scottish Amicable group sales director John Cowan will head SAFS, which will sell ScotAm and Pru-branded products, including new products from Prudential Annuities.
It will have a combined team of 260 but insiders predict it will expand to become a substantial player in the intermediary market, including multi-ties if these become available. Pru will be investing heavily in phone and internet capabilities to service customers.
Wentworth Rose pension consultant Gary Ford says: “More and more companies are pushing in to the intermediary market and more salesforces are disappearing. The days of the tied adviser are numbered as things become so complex, people need independent advice. Direct salesforces are very expensive to maintain.”
Pru spokesman Steve Colton says: “We are reconfiguring the salesforces to refocus on a different range of customer needs. We are ensuring that we operate as a scale player and that customers have greater accessibility across all our distribution channels.”