2023: Todd is doing a wonderful job at GEICO
WARREN BUFFETT: I would like to add one thing. (Applause)
At GEICO, Todd Combs was Ajit’s choice and my choice to go back to GEICO to work on the problem of matching rate to risk, which is what insurance is all about. And he arrived with exquisite timing, right before the pandemic broke out and all kinds of things changed.
But Todd is doing a wonderful job at GEICO. And he works closely with Ajit. He has a home in Omaha, he comes back here, and we get together on the weekend sometimes too. So, that’s been a remarkable accomplishment under difficult circumstances. And he’s not all the way home, but he’s made a very, very big change in multiple ways at GEICO.
And one other thing I would like to mention, there have been a lot of public companies created in the last decade or thereabouts in insurance. And there’s none of them that we would like to own, and they always started out in their perspective saying, “This is a tech company, not an insurance company.”
Of course, they’re a tech company. Everybody, whether they’re insurance or a lot of other places, are using the facility but you still have to properly match rate to risk. And they invariably have reported huge losses, they’ve eaten up capital.
But there’s been one company that nobody has generally heard of. There’s only been one that I know of, company started in the last ten years, that has been an overwhelming success. And that’s a company that Ajit and four people who joined with him set to develop a new business. It’s called Berkshire Hathaway Specialty. What’s the float, Ajit?
AJIT JAIN: Coming up to $12 billion.
WARREN BUFFETT: Yeah. We’ve built more float than probably all these companies combined. It’s cost us essentially nothing in terms of an underwriting loss. The four people have turned into, I don’t know, 1,500 around the world. We took on the whole industry and we brought some unique talent in the four people that came.
And now have, like I said, 1,500 or so worldwide. And we brought capital, and we brought capabilities that really only Berkshire could supply. So, it was the combination of brains, and talent, and energy, and money.
And no one has really successfully entered this space — plenty of people in the space who didn’t like us coming. And we did it without it costing us a dime of entry. And it’s been unmatched by any of the companies that went public. And people have seen us do it, but they can’t duplicate it.
And that’s what Ajit has created. And Peter Eastwood has led this group, Berkshire Hathaway Specialty. And it’s just remarkable. So, anyway, with that — let’s go on — give them a hand for that. (Applause)