The Australian insurance industry has lost 1600 jobs this year, according to the Finance Sector Union (FSU).

It says a combination of offshoring, restructuring, government insourcing and loss of government tenders is behind the decline “as insurers try to increase return on investment at the expense of insurance jobs”.

The FSU has released the figures in response to IAG’s plans to explore further offshoring as part of an efficiency drive. (See earlier story)

The union is encouraging affected workers not to co-operate with consultants, unless incentives are offered.

“If an employee is asked to explain their job to a consultant who is looking to offshore the work, then there is an indignity in that,” National Industrial Officer Angela Budai told insuranceNEWS.com.au. “People should be given incentives to co-operate, but insurers have in the past refused to do this.

“If nobody will explain to the consultant how the job is done, then that has an impact – it is something that has worked with the banks previously.”

Ms Budai says insurers have an obligation to inform the union when jobs are affected, but claims they often try to disguise the true impact.

“Sometimes insurance companies tell us in dribs and drabs – 10 jobs here, 20 jobs there.

“They hope that if they do that it won’t make negative headlines. It’s not until you actually count them all up that you realise how many jobs have gone.

“These companies make lots of profits but are taking Australian jobs away. These are businesses that could provide good semi-skilled jobs in Australia, but it is cheaper to send the jobs offshore.”

IAG, which already has call centres in New Zealand and South Africa, says it has been talking to staff for the past year about automating and outsourcing some processes.

However, the company says it is too early to say what the outcome will be.