Buffett says Berkshire can handle $400bn mega-catastrophe
A giant hurricane, earthquake or other conflagration inflicting unprecedented, catastrophic damage is likely at some point to strike the United States. Warren Buffett says: Bring it on. In his annual letter to shareholders of Berkshire Hathaway Inc, Buffett said "no company comes close" to his conglomerate in its ability to financially withstand even a mega-catastrophe that causes $400bn of insurance losses. Buffett said the odds of such a catastrophe in any year is just 2%, but that Berkshire would lose only about $12bn, a sum more than offset by annual profits from its non-insurance businesses. "Concurrently, much — indeed, perhaps most — of the p/c world would be out of business," he wrote, referring to property and casualty insurers. "Our unparalleled financial strength explains why other p/c insurers come to Berkshire – and only Berkshire – when they, themselves, need to purchase huge reinsurance coverages for large payments they may have to make in the far future." Berkshire e...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.