Insurance unicorn Aco has decided to let go of around 60% of its employees (5% of its total strength) as it becomes more reliant on AI and automation systems. The company clarifies that this is not a cost-cutting measure but an AI-focused structural restructuring. Those affected are spread across various teams in Aco’s 1,200-strong workforce.

The departing employees are being given two and a half months’ notice, 15 days’ salary for every year of service, eight months of health insurance and career support. Aco, which is set to go public in FY27, saw its FY25 loss narrow 57% to ₹424.4 crore, while revenue rose 35% to ₹2,836.8 crore. Employee expenses fell from ₹354 crore to ₹334 crore.

Like global tech giants like Amazon, Microsoft, and TCS, Indian startups are also facing job losses due to AI. In February, Livspace laid off 1,000 employees (12%) as part of its AI push. The Economic Survey 2025-26 points out that while AI will increase productivity, it also poses a serious threat of job displacement.