AXA to cut up to 350 staff in £500m outsourcing deal

A total of 350 staff at insurance giant AXA Sun Life could be made redundant as part of a proposed £500m BPO deal.

The proposed 15-year agreement with Capita will see the services company provide AXA with customer services, policy administration, claims activity and related IT support.

As part of the deal, 1,300 AXA staff working in Basingstoke, Bristol, Coventry and 600 AXA staff working in Bangalore and Pune in India will be transferred to Capita.

Of those 1,900 workers, 350 staff from the UK and India, including IT helpdesk staff, could be laid off over the next five years.

Call centre workers, processing staff and some IT workers are expected to be among those made redundant by the deal, which is projected to deliver net savings of £30m annually to AXA.

AXA said Capita is its preferred bidder to take over the administration of 3.2 million policies which are nearing maturity - meaning they are coming to an end of the period where customers will pay into them.

AXA's spokesman said the earliest policies date back more than 40 years, meaning they have been administered by a range of different legacy IT systems.

"These systems can be quite old and rationalising the different IT platforms will offer a better service and to deliver cost savings," he said.

"Capita already administer about 23 million policies so we can take advantage of their existing heavy investment in IT and servicing infrastructure."

AXA's spokesman said the layoffs in part reflect the gradual reduction in the number of policies needing to be administered as they come into maturity.