ERGO Names AI Chief and Cuts Call Center Jobs

As of Thursday (1st), the executive board of the ERGO group, the direct insurance arm of Munich Re, has appointed a Chief AI Officer. This new position was given to Guy Goldstein, who founded the digital small business insurer NEXT in Palo Alto in 2016, acquired by ERGO for $2.6 billion in 2025, and now rebranded as ERGO NEXT. Goldstein will hold both roles and be responsible for implementing AI across the group’s value chain and in all markets.

"With the creation of this role, we underline our strategic ambition to systematically implement artificial intelligence throughout our value chain," said Markus Rieß, CEO of ERGO, in the announcement on September 25. On the same date, the group announced that Mark Klein, Chief Digital Officer since 2016 and board member since 2024, will leave the company at the end of the year, at his own request.

In February, ERGO stated that it intends to reduce about 1,000 positions in Germany by 2030, partly due to the increasing use of AI in call centers and claims management. The company has around 15,000 employees in the country.

The Cut That Doesn't Appear as Layoffs

ERGO claims it will not execute layoffs: the reduction will come from about 200 departures annually, through retirements and voluntary exits, without replacement. The company also set up a retraining academy to prepare about 500 affected employees for new roles within the group.

This design shifts the axis of the question. Those seeking mass layoffs to measure the effect of AI on administrative work will find little. The effect appears in the positions that are no longer opened: the retiring employee is not replaced, and the recent graduate who would occupy that desk is never hired.

Allianz followed a similar path, on a larger scale. In July, Tomas Kunzmann, CEO of Allianz Partners, the travel insurance and assistance division, confirmed the cut of 1,500 to 1,800 positions, attributed to the expanding use of AI, through severance packages, early retirements, and voluntary programs. Voluntary departure schemes are already under way in Spain, France, Germany, Italy, and the Benelux, in a division with more than 22,000 employees.

The Contrarian Argument, by Name

On Tuesday (29th), the McKinsey Global Institute published an estimate that around 11 million American workers may need to change occupations by 2035. The same study projects that automation will displace the equivalent of 36 million jobs over the decade, while economic expansion will create demand for more than 40 million. "The challenge of the next decade is mobility, not scarcity," says the report.

However, the requirement is high. To absorb the relocation, about 770,000 workers per year would need to switch occupational groups in the U.S., 3.6 times the historical average, according to McKinsey. More than 75% of those needing to change are in three areas: administrative support, retail and sales, and transportation and logistics. This profile matches that of claims adjusters.

There is also evidence that weakens the thesis of accelerated cuts. A survey by Anthropic using American data found no effect on unemployment in occupations most exposed to AI, only preliminary signs of slower hiring among workers aged 22 to 25. Furthermore, the 1,000 positions at ERGO represent less than 7% of the German workforce, spread over five years.

The opposite error also exists. Bain estimated on September 29 that AI would need to generate $6 trillion in annual revenue by 2031 to justify investments in data centers, against a maximum of $1.8 trillion from current products. An insurer is not a hyperscaler: ERGO does not finance data centers; it purchases capacity. For them, the equation does not depend on whether the bubble bursts, but rather on reducing the cost per claim.

From Palo Alto to Europe

In this case, the flow of knowledge runs in the opposite direction to the usual. ERGO NEXT, which serves over 600,000 small American businesses with automated underwriting and pricing, is now setting the model for a German parent company with 15,000 employees. Rieß stated that the idea is to bring this experience "to the group’s board, making it available to ERGO as a whole." ERGO and Allianz Partners are cutting the same way: early retirements and voluntary or negotiated departures.

The common risk is visible on both sides of the Atlantic. If the entry point for insurers shrinks without visible layoffs, the first statistic to record the effect will be the hiring of young workers, not unemployment. When an insurance board asks the new Chief AI Officer for proof of return on investment, the most honest metric may not be how many people left, but rather how many failed to enter.