According to the Berkshire chairman and CEO, the increase in natural disasters has not impacted his insurers.
Warren Buffett has revealed that the increase in natural disasters and the extreme weather from climate change around the world have not affected Berkshire Hathaway’s insurance companies.
Buffett has stated that no changes have been made to the way that catastrophe calculations are made.
He explained that climate change has not affected the calculations that are made in terms of determining how likely it is for a catastrophe to occur. Berkshire Hathaway Inc. is the owner of a number of different reinsurance and insurance companies and funds and must frequently pay sizeable claims when a natural disaster such as severe weather systems occur.
According to Buffett, the last five years have been profitable for insurance companies in terms of hurricanes.
He said that when it comes to providing coverage against hurricane damage in the United States, the sector has seen a considerable amount of profit because there have not actually been all that many storms that have made landfall. According to the CEO and Chairman of Berkshire, the performance of this conglomerate, which is based in Omaha, Nebraska, has been a strong one.
In fact, the results that they saw from their insurance companies helped them to bring in $19.48 billion, throughout the length of last year. This figure was on a revenue of $182.15 billion. This was an increase in their earnings of $14.82 billion on the revenue of $162.46 from the year before.
At a time in which climate change is beginning to produce changes in the weather that are quite dramatic throughout the world. While some areas are seeing record droughts, others are experiencing flooding unlike anything that has ever been seen. At the same time, though, it seems that according to Buffet, this trend has not caused Berkshire to have to make any changes to the way in which they are making their calculations regarding risks and the costs that will be associated with the damages that those weather changes could be generating. Time will tell if this could be quite defining for the insurance industry or if it will cause those insurance companies to diverge from the calculation styles the rest.