Berkshire Hathaway Assurance is a
bond insurance company created by
Berkshire Hathaway, Inc. in December 2007.
History
Berkshire created this government bond insurance company in December 2007 to insure
municipal and state bonds. These type bonds are issued by local governments to finance public works projects such as schools, hospitals, roads, and sewer systems. Berkshire is not guaranteeing BHA, thus opening itself to competition from any number of investors who could easily assemble the $5 billion capital. BHA began insurance operations in New York, with plans to move on to California, Puerto Rico, Texas, Illinois, and Florida. On February 12, 2008,
Warren Buffett
Warren Edward Buffett ( ; born August 30, 1930) is an American business magnate, investor, and philanthropist. He is currently the chairman and CEO of Berkshire Hathaway. He is one of the most successful investors in the world and has a net w ...
announced a plan to add up to $5 billion in capital to BHA to enable it to provide
reinsurance
Reinsurance is insurance that an insurance company purchases from another insurance company to insulate itself (at least in part) from the risk of a major claims event. With reinsurance, the company passes on ("cedes") some part of its own insu ...
on municipal bonds currently guaranteed by
Ambac,
MBIA, and
Financial Guaranty Insurance Company.
[
] Buffet also announced BHA had closed its first deal to insure $50 million in debt for a 2% fee.
In 2014, Moody's said its
credit rating was Aa1. It also has a rating of AAA from S&P.
References
Berkshire Hathaway
Financial services companies established in 2007
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