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Tough times call for hard decisions. Warren Buffett-controlled Berkshire India has decided to close down its online distribution portal —www.BerkshireInsurance.com — later this year.
This has been conveyed to existing customers who had bought general insurance products online from BerkshireInsurance.com.
The decision to close the ‘virtual door’ is being seen by many as Berkshire’s imminent exit from the Indian insurance sector.
BerkshireInsurance.com has informed policyholders that their service needs will be handled by a dedicated team within Bajaj Allianz.
Dedicated team
The effort would be to ensure a seamless transition to Bajaj Allianz’s dedicated service team, which has been set up, sources said.
When contacted, Arun Balakrishnan, Chief Executive Officer of BerkshireInsurance.com, declined to comment on the company’s decision or future strategies.
The decision to close down the online distribution portal is due to the tough economic environment here and the lukewarm response from Indian consumers to buying insurance products online, it is learnt.
The company has not been able to find as many customers as it would have liked in the last two years.
Despite immense potential, online purchase of insurance products has taken off only in a small way in India.
Berkshire India, a majority owned non-direct subsidiary of Berkshire Hathaway, had entered India in March 2011 as a corporate agent of Bajaj Allianz General Insurance.
As part of its entry strategy into the Indian insurance sector, Berkshire India had adopted a unique business model of having only an online presence. This was seen as bold move in the Indian context.
It began operations by selling Bajaj Allianz’s general insurance products directly to retail consumers on BerkshireInsurance.com.
Since March 2011, Berkshire India relied only on online distribution of insurance products and did not venture into having a brick and mortar presence.
It had over the last two years expanded the suite of insurance products for its Indian customers.
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