Berkshire Hathaway’s Chief Executive Greg Abel warned investors during the company’s annual shareholder meeting that the insurance industry is facing mounting competitive pressures that are making it difficult to price policies appropriately.
Speaking to shareholders gathered in Omaha, Nebraska on Saturday, Abel explained the challenges facing the conglomerate’s insurance operations. “The reality is that … as our insurance business softens, we cannot realize the value we should for the related risk,” he stated.
The Warren Buffett-led company saw its first-quarter revenue climb to $81.1 billion, up from $77.6 billion in the same period last year. Abel attributed this increase to what he described as a “pretty benign period” for insurance claims, noting the absence of major disasters like hurricanes or wildfires.
However, Abel pointed out that fresh capital flowing into the insurance market is creating pricing pressures. In response, Berkshire’s insurance operations “will be much more cautious, specifically across the primary and reinsurance businesses” as they navigate the challenging environment between competitive premiums and underwriting risks.
The company’s auto insurance subsidiary, Geico, exemplifies these market challenges. Abel noted that finding the proper balance has been a key priority for the brand.
“We’ve seen unprecedented shopping activity across the auto space” as drivers search for lower-cost coverage, Abel observed. He added that Geico has “worked hard to segment” its customer base to maintain retention despite rising premium costs.
“It’s not going to be easy to just restart the growth engine,” Abel acknowledged regarding Geico’s future prospects.
Geico previously held the number two position in auto insurance market share behind State Farm, but Progressive moved ahead after making earlier investments in technology for better driver assessment and pricing accuracy, industry analysts note.
Under former CEO Todd Combs’ leadership in recent years, Geico regained traction by strengthening its underwriting practices and reducing operational costs, including cutting nearly one-third of its staff to 29,541 employees by the end of 2025.
Berkshire’s Vice Chairman of Insurance Operations Ajit Jain reported in 2025 that Geico had matched competitors in telematics technology, which uses vehicle-installed devices to track driving behaviors like speed, braking patterns, mileage, and distracted driving. This system rewards safe drivers with lower rates while charging higher premiums to riskier drivers.
During the first quarter, Geico’s pre-tax underwriting profits dropped 35% as the company increased advertising spending while facing higher accident claim costs.
Combs departed Geico in December to join JPMorgan Chase, with Nancy Pierce taking over as his replacement. Pierce, who previously served as the insurer’s chief operating officer, has been with Geico since 1986.
