What was behind Berkshire Hathaway’s Chubb insurance company purchase?

Warren Buffett buys

Warren Buffett’s company has been hiding a massive insurer purchase

Berkshire Hathaway started buying again in Q3 2023 and has finally unveiled the largest publicly traded purchase that it has kept from the spotlight: Chubb insurance company.

The Securities and Exchange Commission permitted the secret

The Securities and Exchange Commission made it possible for Berkshire Hathaway, and its owner Warren Buffett, to maintain the secrecy of the purchase while the position was being arranged.  Then, after the May 15 market close, the first quarter 13F was filed and revealed that the Chubb insurance company had been purchased.

The 13F disclosure is a primary method investors and industry watchers use to discover Warren Buffet’s latest moves along with Ted Weschler and Todd Combs, the heads of his investment team.  This filing makes public the steps Berkshire is taking within its publicly traded portfolio.Berkshire Hathaway owners Warren Buffett buys chubb insurance

Signs point to an insurance company investment by Warren Buffett

While Buffett has many investors working on his behalf, it’s broadly believed that he was behind this purchase himself.  If he wasn’t directly behind its selection, he would at least have had to give the green light due to its sheer size.

The new $6.7 billion Chubb insurance company position makes it the ninth holding in his publicly traded portfolio. Furthermore, this newly acquired insurer represents 2 percent of the total portfolio.  Berkshire is now the largest Chubb shareholder, with 6.4 percent of the insurer’s outstanding shares.

Just his kind of a deal

This kind of an investment is precisely the type of deal Buffett tends to seek out, both due to its nature and its size. That said, it could also be that Todd Combs could have played a role in making this selection, as he has a history with Chubb.

Combs managed the investment partnership of Castle Point Capital before he left to take his position at Berkshire Hathaway fourteen years ago.  Chubb comprised 6.3 percent of Castle Point Capital’s portfolio, according to the 13F filing it made in September 2010.

Last year, Combs said that “I owned a lot of Chubb” before he took his position at Berkshire. In that case, he was being interviewed in a podcast and was discussing certain restrictions regarding the ownership of an insurance company within other insurers.

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