Financial services company Liverpool Victoria Friendly Society has signed a 10-year £200m outsourcing deal with services giant EDS which it says will slash development time for new financial products.

Around 200 staff will transfer to EDS under the deal. Most will remain in Bournemouth, where Liverpool Victoria is based. EDS will manage the infrastructure, helpdesk and application development for the Society.

About 70 contractors who were working for Liverpool Victoria will carry on working for EDS.

"We've expanded into new financial services areas, but our competence wasn't based around developing IT," said a spokesman for Liverpool Victoria, which has over one million customers. "To keep providing best value we have to have control over what we spend, and we need to offer quickly the products that our customers are looking for."

Outsourcing is a topic that splits financial services organisations. Some embrace long-term deals, such as Bank of Scotland, which has signed a £1bn 10-year deal with IBM Global Services which it says will save it £150m. Others, such as Nationwide and Capital One have said they wouldn't outsource because IT is so central to the business in financial services.

"Throughout the tendering process EDS impressed us with their knowledge of the financial services sector and outstanding track record in working alongside large organisations," said Liverpool Victoria's director of business services, Joan Halliwell.

Liverpool Victoria has already implemented handheld computing for its door-to-door sales force, but a spokesman said: "If we had done it with EDS we could have done it much faster. This deal leaves us to concentrate on putting value into the business."

EDS has also signed a $300m deal with risk management company Aon. The deal covers its networking, mainframe and mid-range platforms, servers and desktops, all related support functions, service/helpdesk and all voice services. The company said the deal is part of a comprehensive business transformation plan.