Britain’s biggest motor insurer will make 891 staff redundant in the first wave of a £100m cost-cutting drive.
A call centre in Teesside is the biggest casualty and will close with about 500 job losses.
The remaining 400 roles are split across the UK, and are “likely” to mean an unspecified number of redundancies in Yorkshire, the insurer said.
Direct Line is a major Yorkshire employer, with about 3,750 staff at its three sites in Leeds and one in Doncaster.
The group, which also owns the Churchill, Green Flag and Privilege brands, is being prepared for its float on the London Stock Exchange as early as next month.
Chief executive Paul Geddes said: “We have not made these proposals lightly and fully understand the impact this will have on our people. As we have done in the past, we will be open and honest, dealing fairly and carefully with those affected.”
The group said it needs fewer staff to handles calls, and also plans costs cuts at its head office in Bromley, Kent. Areas including IT development, business testing, sales, marketing and commercial all face job cuts.
Asked about Yorkshire redundancies, a spokeswoman said: “There’s likely to be some impact,” but declined to specify numbers.
Direct Line has started a consultation with affected staff and said it hopes to redeploy workers.
Direct Line recently reported seven per cent rise in operating profits to £224.2m in the first half of 2012. The insurer employs 15,100 staff and has 15 UK offices.
RBS must sell Direct Line by the end of 2014 in return for its £45bn taxpayer bail-out in 2008.