Berkshire Hathaway is shuttering its online distribution business in India two years after it began offering non-life products as a corporate agent of one of India's major insurance providers.
Since March 2011, Berkshireinsurance.com, sold vehicle and travel insurance policies on behalf of Bajaj Allianz General Insurance Co., a joint venture between Germany's Allianz SE and financial services corporation Bajaj Finserv.
“We have received an intimation that our corporate agent has decided to discontinue their online model of selling insurance,” said a Bajaj Allianz spokesperson in a statement, although the company declined to offer a reason for the deal's termination.
Reuters India reports that a private source said online insurance has failed to become popular with the Indian demographic. Arun Balakrishnan, Berkshireinsurance.com's chief executive, said in the Wall Street Journal late last year that he wanted to make the site a top-three company selling insurance online in India within three to five years of opening the business.
Other insurance providers in India, such as ICICI Lombard General Insurance Co. and HDFC Ergo General Insurance Co., have capitalized on the country's rapidly-growing internet user base, and often sell policies online for up to 60 percent cheaper than those bought via other channels.
Bajaj Allianz has said that existing policies would continue being serviced by Bajaj Allianz as the website closed.
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