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AFP

Insurance giant IAG has axed 214 jobs despite reporting a profit of AU$898 million, drawing ire from union leaders, who claimed the company prioritized profit over employee loyalty.

The affected areas will be the Direct Insurance Australia and Intermediated Insurance Australia divisions. The $17.3 billion, ASX-listed insurance biggie has announced that affected roles span digital business support, direct claims, distribution, and underwriting, reported Insurance Asia News.

The Financial Services Union (FSU) national secretary, Julia Angrisano, said there was "no business need" for the cuts, given the whooping profit turnover.

"The IAG Board have chosen to put profits ahead of their workers and in doing so are disrespecting loyal IAG staff who've stuck by the insurer in tough times," she said. "Whether it was during Covid, or to assist customers during times of natural disasters, IAG workers have consistently stood by the company, taking on extra hours and being more productive. To reward that loyalty by cutting jobs is disgraceful."

"Last month when IAG CEO Nick Hawkins reflected on the strength the IAG business, he acknowledged that those strong results came off the back of the hard work of IAG staff. How is showing staff the door an appropriate way to repay their loyalty, and their contribution to the profitability of the business? We're calling on the IAG Board to reconsider this decision and think of the impacted workers who are facing an uncertain future," she added.

Notably, IAG reported impressive full-year results, with net profit up 7.9% to $898 million. The company's insurance profits enjoyed a steeper increase, jumping 79.1% to $1.43 billion, News.com.au.

Following the impressive profits, IAG CEO Nick Hawkins had said, "The trust our customers have in our brands is reflected in continued high customer advocacy and retention in our retail businesses in Australia and New Zealand. We are well positioned to continue supporting our customers and the broader economy. The strategic measures we have put in place over the past few years have created a stronger and more resilient IAG."

"We've streamlined our Australian business, established a clear brand strategy and launched NRMA Insurance nationally, outside of Victoria," said the CEO of the company with about 14,000 employees.