Berkshire Hathaway Inc. (NYSE:BRK.A) (NYSE:BRK.B) has confirmed that its specialty insurance unit has commenced operations.
Berkshire Hathaway Specialty Insurance is Berkshire Hathaway Inc. (NYSE:BRK.A) (NYSE:BRK.B)’s recently formed commercial property casualty insurance group. It will be involved in underwriting property, casualty, professional and executive liability insurance and programs for customers in the U.S.
Peter Eastwood, who left American International Group Inc (NYSE:AIG) is the new company’s president. He was the CEO of American International Group Inc (NYSE:AIG)’s property-casualty operation in the Americas.
Berkshire Hathaway Announces Management Team
In its June 13th news release, Berkshire Hathaway Inc. (NYSE:BRK.A) (NYSE:BRK.B) announced the other four members of the management team for the specialty insurance company. David Bresnahan will handle casualty, health, professional and health liability, while Sanjay Godhwani will handle property and programs. Finance, insurance, underwriting and actuarial will be led by David Fields, while claims are handled by David Crow.
In a statement the revered sage of Omaha said, “It’s official. We are moving into commercial insurance in a substantial way, and we are here to stay.”
He sounded out a warning to competitors when he indicated that the company is targeting substantial long-term growth in the sector.
With the growing importance of U.S. excess and surplus lines insurance, the company would primarily focus on this market segment to offer tailor-made solutions to customers. Policies are underwritten on the non-admitted paper of National Fire & Marine Insurance Company. The Berkshire Hathaway Inc. (NYSE:BRK.A) (NYSE:BRK.B) group has access to the admitted paper of National Indemnity to underwrite on admitted paper, wherever considered necessary.
Both the companies hold AA+ ratings from Standard & Poor’s and A++ from AM Best.
Exuding confidence, Peter Eastwood, president of the new company, indicated his team is excited to build a commercial property and casualty insurance business within a company that understands and values the insurance business.
The new company has Boston as its home base with regional underwriting offices located in Atlanta, Chicago, Los Angeles and New York.
Berkshire Hathaway Inc. (NYSE:BRK.A) (NYSE:BRK.B)’s entry into commercial insurance operations would complement its units selling reinsurance and auto coverage and can give the billionaire investor more funds to buy stocks and fund takeovers.
Berkshire Hathaway Inc. (NYSE:BRK.A) (NYSE:BRK.B)’s chairman and chief executive officer Warren Buffet has used premiums from insurance operations over four decades to build a $280 billion holding company that hauls freight, generates electricity, manufactures chemicals and sells chocolate.