Jain feeds Buffett’s hunger

I'm a bit late getting to this, but thanks to those who passed the link along.

The first signs of a new Ajit Jain came at the January 2012 renewals, when the potential heir to Buffett played big on Australasian cat and international retro.

Jain took a large share of the IAG property cat treaty that had handed painful losses on to the pre-existing markets. It looked like classic Jain: hundreds of millions of dollars of capacity thrown at the feet of a cedant that was struggling for capacity. In hindsight, it became clear that it was the first in a series of mammoth cat and multi-line deals with cedants from Asia Pacific.

IAG was followed by a hefty (and uncapped) retro quota share for Asia Capital Re; next came some aggressive Japanese quake pro rata deals and a gargantuan quota share with Toa Re.

After Berkshire Hathaway made its presence felt during the Indian renewals, the New Zealand Earthquake Commission (EQC) was next as the reinsurer came from a standing start to write a NZ$500mn line to help the programme expand substantially.

By far the most prominent deal in Jain's Asia Pacific push was made with loss-hit Australasian cedant Suncorp. Berkshire ramped its line on the main programme up to around $800mn, hoovered up the entire New Zealand buy-down protection and wrote a $300mn-premium quota share of Suncorp's Queensland homeowners' book. It is believed all of this was written for a three-year period.

And this agreement overshadowed a multi-year deal with Berkshire that took the whole of New Zealand insurer AMI's NZ$1.4bn cat programme out of the market, denying resentful loss-paying markets the chance to earn their payback.

At the beginning of 2013 Berkshire filled in the final piece of its Australasian strategy by striking a deal with QBE to write 15 percent shares of a range of its programmes, including the company's $1.3bn global cat treaty and its global aggregate cover.

All in all, Berkshire Hathaway is thought to have swollen its Asia Pacific writing by between $1.5bn and $2bn in this period of frenzied activity, with most of this coming through multi-line uncapped quota shares or cat excess-of-loss business.