Warren believes Berkshire Hathaway Specialty is destined to be one of the leading property-casually firms in the world
Berkshire Hathaway Specialty Insurance generated $1.3 billion of premium volume in 2016.
This business is on the smaller end of commercial property-casualty insurers in terms of scale, although its volume did grow 40 percent last year.
In a highly competitive commercial P&C environment, what gives you confidence that Berkshire Hathaway Specialty is destined to become one of the world’s leading commercial P&C insurers, as you said in this year’s annual letter?
Yeah. I think it will be. And I think how fast it grows depends very… it does depend very much on the market.
I mean, we’re, you know, we are not interested in trying to be a price-cutter in a market where the prices already aren’t that attractive.
But we have built the scale, worldwide. And a lot of this has just been added in, you know, recent months and just over the past year. We have…
We will grow a lot. But if the market should turn hard for any reason, we would grow a lot faster.
But we are destined, at Berkshire Hathaway Specialty, to be one of the leading PC firms in the world, just as we were destined to have… when Ajit came in, even though we had nothing… we were destined to become a very important reinsurer throughout the world and, in certain ways, almost the only reinsurer for certain types of risks in the world.
And we’ve got the people. We’ve got the capital. We’ve got the reputation. There is no stronger company in the insurance world… and there won’t be… than the Berkshire Hathaway insurers.
We’ve got the talent there.
So it will grow. It may grow slowly some years. It may have big jumps just like the reinsurance operation did many years ago. But it’s a very important addition to Berkshire that brought that on. I wish… just wish we could’ve started a little earlier.
But we had to have to right people. And they came to us. And, as you say, we wrote whatever it was, a billion-three or a billion-four last year, and we’ll write more this year. But we won’t write as much as if we were in a hard market.
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