(Bloomberg) — Warren Buffett, the billionaire chairman of Berkshire Hathaway Inc., said he expects a slump in reinsurance results in the coming decade as investors enter the market.

"It's a business whose prospects have turned for the worse and there's not much we can do about it," Buffett said Saturday at his company's annual meeting in Omaha, Nebraska. The reinsurance industry in the next 10 years "will not be as good as it has been in the last 30."

Hedge funds are setting up offshore reinsurers to gain a tax advantage, underwriting a small amount of business as a "facade," Buffett said. Competition has driven down prices, while low interest rates pressure bond portfolios.

Continue Reading for Free

Register and gain access to:

  • Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
  • Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
  • Educational webcasts, white papers, and ebooks from industry thought leaders
  • Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.