By Jonathan Stempel
(Reuters) – Berkshire Hathaway’s Geico car insurance unit has made progress in upgrading its technology to better match rates with risk, Berkshire Vice Chairman Ajit Jain said on Saturday.
Jain, who has day-to-day oversight of Berkshire’s insurance operations, spoke at the conglomerate’s annual meeting in Omaha, Nebraska where he, Chairman Warren Buffett and Vice Chairman Greg Abel fielded shareholder questions.
Geico posted substantially improved results in 2024, as it curbed its appetite to issue new policies while reducing the percentage of premiums it used to pay accident claims.
The vice chairman said Geico has made “rapid strides in telematics” and now “is as good as anyone.” Jain praised Geico’s CEO Todd Combs for reducing the company’s workforce. Geico cut more than 2,300 jobs last year.
“All this has allowed Geico to become a more focused competitor,” he said, adding it is too soon yet to say “mission accomplished. We have achieved a lot, but we have to do a lot more.”
At Berkshire’s 2023 annual meeting, Jain lamented that Geico was behind the curve in telematics, where devices installed in vehicles let insurers monitor behavior including speed, braking, mileage and distracted driving including cellphone use.
Insurers can then reward safe drivers with discounts, and price policies appropriately for other drivers.
Then at Berkshire’s 2024 annual meeting, Jain lamented that Geico was “still behind” but hoped by the end of 2025 to catch rivals in data analytics including pricing for risk, although Geico still enjoyed lower operating costs than “virtually anybody.”
(Reporting by Jonathan Stempel, in Omaha, and additional reporting by Suzanne McGee; editing by Diane Craft)
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