2012: Will Berkshire increase its presence in commercial insurance lines?

JAY GELB: This question is on Berkshire’s commercial insurance operations. Berkshire has a smaller presence in primary commercial lines insurance compared to its much larger reinsurance and auto insurance businesses.

Under what circumstances would Berkshire be open to increasing the scale of its primary commercial insurance operations, including acquisitions?

WARREN BUFFETT: Yeah, if we thought we can either expand internally, which would be tough, or buy a great company in the commercial field, which would — that would be the more likely way — you know, we’d do it.

Now, we got a chance, I don’t know, six or seven years ago to get in the medical malpractice field when GE wanted out and we bought that, and then we added to that with our Princeton Insurance acquisition last year.

So we did get a chance to go into a first-class company with a first-class manager in Tim Kenesey about six or seven years ago, and we jumped at it. And GE was just getting out of the insurance business.

So it’s hard to think of very many commercial insurance companies that I would get excited about, a very few. There might be a couple, and we’d like the business. I mean, you know, there are very few personal lines companies we like, but love GEICO, obviously.

There are very few reinsurance companies we like, but we love the ones we’ve got. And if we could find a quality company in commercial lines and we — presumably it would have quality management — we’d buy it in an instant. We’ve got nothing against that business.