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Berkshire Hathaway has quietly built a $6.7bn position in New York-listed Chubb, one of the world’s biggest insurance companies, highlighting Warren Buffett’s continued interest in financial services, according to regulatory filings published on Wednesday.
Buffett’s conglomerate had been amassing a large minority stake in Chubb since last year, but regulators allowed Berkshire to keep the position confidential. The filing reflected its stake in Chubb as of March 31. The insurance group has a market capitalisation of more than $100bn.
Chubb’s stock shot up more than 9 per cent at one point in after-hours trading.
Berkshire’s cash pile has swelled this year as Buffett has trimmed his stakes in stocks such as Apple that have historically buoyed his portfolio. Its cash position hit a record $189bn in the first quarter.
Institutional investment managers in the US that manage more than $100mn must report their holdings in regulatory filings. But they can request “confidential treatment” to omit certain positions.
Berkshire requested that exemption for at least one of its stocks in regulatory filings last year, which have since been amended to include its stake in Chubb.
Chubb — which provides products such as home, car and liability insurance — has grown into one of the largest insurance companies globally. Headed by chief executive Evan Greenberg, the company employs about 40,000 people.
In recent years, bets on insurance have brought their own set of risks. Chubb, for instance, is one of the insurers on the hook for the collapse of Baltimore’s Key Bridge in March.
It is expected to send a $350mn payment to the US state of Maryland within weeks, although the company will ultimately only be responsible for a portion of that payout.
Berkshire, which recently held its annual meeting, has been selling more than buying lately as Buffett has struggled to find worthwhile investments at a time when the S&P 500 index is consistently hitting new highs on the back of strong economic data.
The revelation of Berkshire’s stake in Chubb comes as the conglomerate braces for a post-Buffett era. At the company’s annual meeting earlier this month, Buffett laid out a sweeping role for Greg Abel, who will have the final decision on the firm’s investments.
Buffett, known as the Oracle of Omaha, has been a longtime investor in the financial services sector, including owning car insurer Geico, and having stakes in global payments provider Mastercard and Bank of America.
