Allstate Corp., has announced it is purchasing Esurance and Answer Financial for approximately $1 billion. Esurance and Answer were owned by White Mountains Insurance Group Ltd., which is part of Warren Buffett's Bershire Hathaway group. The move gives Allstate an entry into the direct sales/Internet marketing channels.

Allstate has been losing market share over the past several years to competitors with direct sales channels, such as Progressive and GEICO.

The company plans to fund the deal with available cash. The sale should be completed by the end of 2011.

Esurance and Answer Financial will reportedly keep their brand names.

Allstate’s auto insurance policy count fell by 0.7 percent from March, 2010, to March, 2011. By comparison, Progressive’s auto insurance policies grew by 5.8 percent during the same time span.

Allstate is expected to use its claims expertise to help Esurance control claim costs.