Geico is considering 6 percent layoffs, which will see about 2,000 employees lose their jobs.
CEO Todd Combs sent a letter informing staff of the job losses.
He wrote: “This very difficult decision was not taken lightly.
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“We recognize we’re saying goodbye to beloved colleagues and friends, and as a leadership team we are committed to supporting those affected in the days ahead.”
Combs hopes to “better position [Geico] for long-term profitability and growth.”
Specific reasons for the layoffs were not provided.
Combs cited challenges such as inflation, extended repair turnaround times due to staffing and supply shortages, and increasing medical costs.
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Combs wrote: “Despite these historic challenges, we have made great progress in returning GEICO to profitability and establishing a foundation for growth while increasing our agility and strength in the long term.”
However, he noted the company’s need to adapt and remain competitive.
Geico has pledged to provide career transition assistance to affected workers.
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They can apply for other available positions within the company.
Additionally, the letter conveyed a policy change for remote and hybrid employees, requiring them to increase their in-office days.
The shift aims to align with evolving work practices across industries, with full implementation scheduled for January.
