"It became uneconomical", Yashish Dahiya, Founder & CEO of PolicyBazaar told MediaNama, about the impact that the IRDA regulations had on the web aggregator business. "They said that anybody who provides comparison needs to be come a web aggregator. The economics of that were unreasonable. We used to give inquiries to insurance companies, and they used to do transactions. That was the model." PolicyBazaar, yesterday, announced a fund raising of $5 million from Inventus Capital, Info Edge and others. As we mentioned in our post, IRDA regulations, which fixed leads atRs 10 each, fixed commissions, among other major changes, had completely disrupted business models being used by web insurance aggregators. So how did PolicyBazaar's business model change? "Insurance companies used to give the lead from web aggregators to a call center operation. We pitched to the companies saying that we can run the call center for them. We did better in terms of performance. The two inputs for insurance companies were the lead and the call center. We made that far more productive. That's the core of the business we run today. 85% of the revenue is from call center for the company. The call center means we don't need feet on the street. The insurance companies now buy leads, and taking on the call center cost. We're a distance marketing company, and there's a distance marketing regulation as well." So does that mean that PolicyBazaar's web aggregator business, which used to do comparison of insurance products, is no more?…
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