Berkshire Hathaway to Release More Data on Insurance Cat Losses
June 13, 2013 by Zachary Tracer
Warren Buffett’s Berkshire Hathaway Inc. is providing more data about claims costs at insurance units after the U.S. Securities and Exchange Commission pressed the company for the information.
We “agree to provide disclosures in future filings of the significant catastrophe losses for our insurance group as a whole and for each of our underwriting units to the extent that such losses are significant,” Marc Hamburg, chief financial officer of Omaha, Nebraska-based Berkshire, said in a letter to the SEC dated April 25 and released today.
The SEC has pressed Berkshire for information on its derivatives holdings and writedowns of stock and bond investments. Buffett’s firm has a dozen insurance businesses including Geico, which sells auto coverage, and reinsurers General Re and Berkshire Hathaway Reinsurance Group.
Superstorm Sandy, which struck the U.S. northeast at the end of October, cost Berkshire about $1.1 billion before tax, including losses of $490 million at Geico, according to the letter released today. The company also disclosed losses tied to 2011 earthquakes in New Zealand and Japan and the 2010 oil-rig explosion in the Gulf of Mexico.
Insurers have been expanding disclosures to help investors. Allstate Corp., the largest publicly traded car and home insurer, in 2011 began announcing catastrophe losses on a monthly basis when they exceed $150 million. MetLife Inc., the largest U.S. life insurer, explained in a presentation last month how annuities it sold would fare in a market downturn.
The SEC said it finished its inquiry in a May 14 letter to Hamburg. The correspondence is typically released after the regulator concludes its analysis.
With assistance from Noah Buhayar in New York and Andrew Frye in Rome. Editors: Dan Kraut, Rick Green
