Berkshire Hathaway’s primary business sees underwriting earnings jump almost 250%
Berkshire Hathaway’s Primary Group, which includes Berkshire Hathaway Specialty Insurance (BHSI) and other primarily commercial units, increased its underwriting earnings by 248% last year to $1.37bn from $393m in 2022.
Premiums earned rose to $17.12bn from $13.74bn and premiums written increased 24.1% to $18.14bn, including a 16% rise at BHSI.
The primary business saw its losses and adjustment expenses increase 13.5% to $11.22bn. But its loss ratio fell 6.4 percentage points in 2023, reflecting lower losses from current year catastrophes and changes in business mix. Incurred losses from significant catastrophes were $37m in 2023 and $641m in 2022.
Losses and loss adjustment expenses also reflected net reductions in estimated ultimate liabilities for prior years’ loss events of $537m in 2023.
Berkshire Hathaway Reinsurance Group saw its P&C underwriting result improve 61% to $3.51bn from $2.18bn. P&C premiums earned rose to $21.94bn from $16.04bn.
Premiums written increased 31.8% to $22.36bn. The firm attributes the rise in premiums to increases in new property business and higher rates.
The improved performance in both primary and reinsurance helped Berkshire Hathaway’s overall insurance business deliver underwriting gains of $5.43bn last year following a loss of $30 in 2022. This included a jump to $848m in Q4 from $160m.
The numbers were helped by improved insurance-investment income, up to $9.57bn from $6.48bn. Premiums earned rose to $83.4bn from $74.58bn.
The insurance business set sales, float and underwriting profit records, helped by higher rates, the company said.
