The General Re unit of Warren Buffett’s Berkshire Hathaway Inc on Friday named longtime reinsurance executive Kara Raiguel as its new chief executive officer, replacing the retiring Tad Montross.
Raiguel will report to Ajit Jain, who oversees Berkshire Hathaway Reinsurance Group and has long been viewed as a potential successor to Buffett at Berkshire itself.
In an internal memo issued on Thursday and obtained by Reuters, Jain said Raiguel has been a “key player” at his reinsurance division for more than 15 years, his “secret weapon” for 10 years, and a “true renaissance woman in the insurance and reinsurance industry.”
Jain highlighted her work including the creation of a large California workers’ compensation program, and a foray into India’s reinsurance market.
Montross had been chairman and CEO of Stamford, Connecticut-based General Re since 2008, and reported directly to Buffett.
Raiguel was not immediately available for comment. The memo was earlier reported by The Wall Street Journal.
Reinsurers provide protection for traditional insurers.
Berkshire paid about $16 billion for General Re in 1998 and after initial struggles the unit has performed better recently.
Buffett nonetheless warned on April 30 at Berkshire’s annual meeting that the industry will fare less well in the next decade as more investors enter the business and push prices down.
In the memo, Jain agreed that the industry faces “serious headwinds.” He said Raiguel’s first priority in the next 90 days is to decide how best to add business without sacrificing underwriting discipline and business integrity.
Berkshire owns some 90 businesses including energy companies, food and clothing companies, and a railroad.
The Omaha, Nebraska-based company has become less reliant on insurance and reinsurance as it diversifies, but generates much of its power to invest and make acquisitions from “float,” the amount of insurance premiums collected before claims are paid.
General Re and Berkshire Hathaway Reinsurance accounted for more than two-thirds of Berkshire’s roughly $88 billion of float as of March 31.