Interview - Steve Payne

Bupa Health Assurance’s Steve Payne talks to Paul Robertson about its future as part of Friends Life

It is common knowledge that Bupa is to become part of Friends Life, along with Friends Provident and AXA’s protection arm. The Resolution-funded plan is for a relaunch of the Friends brand towards the end of the first quarter this year, which will coincide with the bringing together of the Friends and AXA propositions. So Bupa will find itself merging with just one company, Friends Life.

But what of Bupa? What is its timetable? What of its products, both present and future? In short, what’s going on there?

As with so many of these events, there are, to paraphrase Donald Rumsfeld, things that are known and unknown, and things that we know we don’t know yet.

One thing we do know is that Resolution will not be making any further UK insurance acquisitions in the near term, so the three will not have to make room in the deal for a fourth or fifth insurer (see news, page 5).

For clarity, COVER has gone to the top and asked Steve Payne, chief executive of Bupa Health Assurance (BHA)what is to follow Resolution’s £102m purchase.

Steering through the changes

Payne is a cautious man, and makes it clear how early the process is in its execution, and how short its working window is: “We completed the transaction on 31 January and we have the use of the Bupa brand for nine months post-completion, so that effectively defines the timetable for us planning an orderly migration into a single Friends proposition by the end of the year.”

Three companies with three product portfolios. What does he expect? A best of breed hybrid concept or some products standing alone?

There is a plan. Payne explained: “When we relaunch the Friends brand in a few weeks’ time, we will see more clarity about the framework that holds the products. This is not a muddle-through. There is a well-organised structure here,
a well-thought out plan to create what we will be part of.”

He added: “For group risk, we are a particularly good fit for the parent, with a viable proposition for group income protection. We also have group life, flex benefits capability and probably the market-leading critical illness proposition.”

Essentially, as Payne explained, the group needs to migrate products across and mould the two income protection propositions into one. For group risk, the only products with overlap are the group income protection products, so we can expect the rest to stand as is under the new banner.

However, Payne was keen to add: “We won’t stop product development in these products leading up to the change, so they may be improved.”

On the individual side, there is more overlap and the task here is to combine with the Friends brand to create the best of the best.

Payne said: “But if I keep my Bupa hat on for the moment, we have a very strong critical illness product and after the refresh last November we think it is the best in the market. I can say that our product strength has never been greater. Mind you, we genuinely need to look across the whole of the piece and retain what is valued.”