Insurance company Pearl Assurance has announced it is to cut 1,900 jobs in the UK.

The scale of the job losses has left the staff devastated... [we] fear the worst

Roger Lyons, Amicus union

The company said it was axing of its entire team of 1,000 direct sales people, plus 900 office staff.

Job cuts at Peterborough-based Pearl had been expected following a review by its owner, the Australian insurance firm AMP.

The cuts come on top of 1,500 job losses announced in June.

'No choice'

AMP had used the funds of Pearl to buy other UK firms such as insurance firm NPI and fund manager Henderson Global Investors.

But this left less money in reserve to cushion against lower share prices.

Following the recent falls on the stock market, AMP had to inject �500m into Pearl's life business to make sure the firm met UK solvency rules.

"These have been difficult decisions to make because of the impact on our people," said AMP's chief executive Andrew Mohl.

"However, given tough equity markets and the well-publicised issues of the UK life market, we have no choice," he added.

"We will do everything possible to minimise the number and consequences of redundancies."

Pearl's head office at Peterborough is expected to bear the brunt of the job losses, but the firm said the cuts would be spread across the UK, including offices in London, Tunbridge Wells, Cardiff and Bristol.

The firm now plans to set up a team of up to 100 self-employed financial planners to advise on pensions, and a team of up to 150 people to sell mortgages.

Union fears

Amicus said it now feared about the future of the company.

"The scale of the job losses has left the staff devastated and leads us and our members to fear the worst," said Roger Lyons, Amicus' joint general secretary.

He said he now wanted to meet AMP bosses to discuss prospects for those staff left at Pearl.

Earlier on Tuesday, Mr Lyons told the BBC Radio 4 Today programme that door-to-door sales teams were on their way out.

"The world has moved on, people's habits have changed," he said.

Savings

AMP said the changes at Pearl including redundancy payments would cost about 320m Australian dollars ($180m; �115m).

And it said it would make savings of about �160m next year, compared with a previous estimate of �100m.

AMP's share price has nearly halved over the past few months.

"We found that the strategy of simultaneously trying to build out UK business and pursue international growth was inappropriate, particularly in difficult market conditions," said Mr Mohl.