Co-operative Insurance has signed a 10-year business process outsourcing contract with preferred bidder Capita in a bid to save costs and improve customer service.
Under the £270m deal, 800 Manchester-based Co-op staff working in customer care and claims support will transfer over to Capita but remain working in the city.
The deal means Capita will provide customer services, policy administration, new business and claims activities and the associated technology for nearly 5 million policies across Co-operative Insurance’s life and pensions and unit trust operations.
It will also build a platform intended to boost Co-op’s new product development.
David Anderson, chief executive at Co-operative Financial Services, the insurance operation's parent, said that extensive changes across Co-operative Insurance were starting to pay off: “Over the last three years, the change programme undertaken within Co-operative Insurance has delivered significant customer and business benefits ahead of schedule.”
In April, the company extended its 12-year outsourcing contract with Xansa in a deal expected to be worth up to £100m over five years.
And in July, the insurance division’s parent, Co-operative Financial Services (CFS), announced plans to cut 1,000 back office staff, and it was thought IT workers would be included in that figure.