Still, Berkshire’s net income, which is affected by the swings in its $245bn equity portfolio, benefited from the stock market’s rally. Investment gains fuelled an 82% jump in net income from a year earlier.
Geico, the company’s auto insurer, reported a nearly 27% drop in pretax underwriting earnings, partially driven by a programme to give consumers premium credits because of the pandemic.Covid-19 continued to put pressure on Berkshire’s operations. For its insurers, it meant not just claims tied to the pandemic, but also customers failing to pay premiums and higher operating costs with staff scattered. Operations such as the railroad were also hit by ripple effects from the virus and shutdowns.
Berkshire’s operations, such as aerospace-parts maker Precision Castparts, have had to furlough or cut workers this year as the virus gripped the nation. Buffett’s company warned in its third-quarter report that some businesses might have to continue to restructure. Berkshire’s recently been expanding its hunting horizons, with its $6bn bet on Japanese trading houses and even a stake in the newly public Snowflake Inc.