Aspen Insurance Holdings Ltd intends to cut jobs as part of an efficiency drive.

But the cost-cutting focus will be more on its London and New York offices than its Bermuda headquarters.

That was the message to come out of the Bermudian insurer and reinsurer’s conference call with analysts after the company released third-quarter earnings, showing a loss of $253.8 million after heavy catastrophe losses related to hurricanes and earthquakes.

Last week, Aspen announced an “operating effectiveness and efficiency programme” aimed at making $160 million in savings over the next three years and $80 million annually in the longer run.

In the conference call, Chris O’Kane, Aspen’s chief executive officer, confirmed that the programme would involve reducing the payroll, as a result of outsourcing some support functions.

“As a result of these changes, we anticipate significant headcount reallocations and reductions, particularly from our higher-cost locations,” Mr O’Kane said.

“These changes obviously affect people, they are difficult to make, they need to be made sensitively, and they need to be made in accordance with local requirements.

“But they are absolutely necessary to strengthen the competitive position of our company.”

He went on to describe the aims of optimising operating processes, reducing duplication and making more effective use of technology to enhance efficiency and support management decision-making.

Asked for more detail on staff reductions, Mr O’Kane’s comment suggested that the Bermuda head office, at 141 Front Street, was not the main target.

“Some functions, you do them in Bermuda, because Bermuda is the best place in the world to do it, and we’re very committed to that market and that is not going to change,” Mr O’Kane said.

“I’m thinking from our point of view, certain lines of business, property-catastrophe reinsurance is the most obvious one. We do a lot of casualty, particularly excess casualty.

“Bermuda is great to do these, and I see no change in the underwriting appetite we’ll be exposed to, for example, in that office.

“Equally, we have a very effective treasury and investment function based in Bermuda, done a great job, and I also see no change there.”

Mr O’Kane then described Aspen’s operations in the US and UK as being “the bigger, more expensive centres”.

“We have about 630 people in London EC3,” Mr O’Kane told analysts. “London EC3 is the most expensive postcode or one of the expensive postcodes in England, in the world.

“And clearly, we need a lot of people there because that’s where Lloyd’s of London is, that’s an insurance centre, our underwriters need to be there, proximity brokers. And those people need to back up the underwriting need to be there too.

“But there are an awful lot of other functions where we have to ask ourself, do you need to do them in the most expensive place in the world or could you do them somewhere else?”

Underwriters, he added, spent a lot of time checking and rekeying data, but the planned changes would take away much of that “drudge”.

Mr O’Kane said: “So I think over this, we will be a smaller organisation in headcount terms, but we’ll be a much more efficient and much more enthusiastic and much more fulfilling place to work. That’s the exciting part of what is here.”

Aspen is far from alone in the Bermuda re/insurance industry in seeing the need for greater efficiency, especially through the use of technology.

Earlier this month, Mike McGavick, CEO of XL Catlin, said that “cost has to be driven out of the system relentlessly”.

The insurance industry on average was giving consumers back about “60-something cents on the dollar, with all the rest of it disappearing into various kinds of costs”, Mr McGavick said at the ILS Bermuda Convergence conference in Hamilton. He added that this was an “intolerable trade” for the consumer.