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XL Capital trimming workforce by 10%

XL Capital is axing 10 per cent of its workforce after recording a £1.8bn net loss during 2008.

The global firm, which operates in the insurance, reinsurance and investment markets, has announced it is to shed jobs as part of a cost saving drive following the toughest year of the companies history, which saw the group record a net loss of £0.9bn in Q4 2008, compared to £839m in Q4 2007.

Group chief executive officer Michael McGavick says: “The ground has shifted in the past six months for the insurance industry, the global economy, and XL. We must recognise these changes and adjust. Therefore, we will look to trim approximately 10 per cent of our global workforce this year to streamline operations to best position XL to compete effectively.

“The job eliminations will be primarily focused on the corporate and functional areas. But efficiency means more than just job eliminations.”

Despite the group’s life operations business contributing £18.7m to the business last year, McGavick says selling up could be on the cards. He says: “During the fourth quarter of 2008, we sold the renewal rights for our Life, Accident and Health business, which is a small block, and we continue to explore various strategic options for the annuity book, the mortality and critical illness book and for our US life company.”

Gross written premiums also dipped from £511.6m in 2007 to £475.8 in 2008, with total gross premiums sliding 15 per cent in Q4 2008, and net premiums 13.9 per cent.

McGavick says: “2008 as been the toughest year in XL’s history. Not only are we happy to say goodbye to 2008, we are excited at the prospects for 2009.”

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