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Reinsurance Division

Berkshire Hathaway’s Reinsurance Division was established in late 1969 to participate in the global reinsurance market during a period of tight capacity and high rates.

📝 Strategic History

  • Inception (1969): Launched under the leadership of George Young.
  • Early Success: Rapidly became a significant profit producer, taking advantage of the favorable rate environment in the early 1970s.
  • Discipline: The division is known for its extreme underwriting discipline, frequently canceling contracts and allowing volume to drop when competitors engaged in "unsound" rate-cutting.
  • Role in Portfolio: Buffett views reinsurance as an attractive area to employ capital, but only when premiums are commensurate with the exposure to catastrophes.

🔗 Connections

📚 Historical Mentions & Citations (4)

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1971 LetterReference Only
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Mentioned in this document.

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📜
1972 LetterExcerpt Available
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Also as predicted in last year’s report, our reinsurance division experienced many of the same competitive factors in 1972. A multitude of new organizations entered what has historically been a rather small field, and rates were often cut substantially, and we believe unsoundly, particularly in the catastrophe area. The past year turned out to be unusually free of catastrophes and our underwriting experience was good.
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📜
1974 LetterReference Only
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Mentioned in this document.

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📜
1975 LetterReference Only
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Mentioned in this document.

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