Berkshire Hathaway’s insurance underwriting earnings fell 43% in the third quarter of 2026, dropping to US$1.35 billion from US$2.37 billion a year earlier, according to the conglomerate’s Q3 earnings release filed with the US Securities and Exchange Commission. The decline was the steepest among major carriers that have reported third-quarter results.
The divergence across carrier results carries read-across for brokers worldwide assessing where to place business heading into January 2027 renewals. As the world’s largest insurer by assets, Berkshire’s underwriting performance is a bellwether for conditions across the global market. Carriers absorbing higher personal auto losses or casualty reserve deterioration may tighten appetite or adjust pricing in those segments, while those with stronger underwriting positions could compete more aggressively for accounts.
GEICO, one of the largest personal lines carriers in the US, was the primary driver of Berkshire’s underwriting drop. The unit reported a combined ratio of 84.5% for Q3 2026, with management citing higher claims frequency, increased average severity, and rising commissions and advertising expenses.
As the Insurance Information Institute (Triple-I) and Milliman have noted, the broader US P&C industry is on track for a 94.0 net combined ratio in full-year 2026, making Berkshire’s personal lines deterioration stand out against the sector’s aggregate strength.
Those loss trends align with data from the Triple-I and the Casualty Actuarial Society. A joint analysis published in October 2026 found that motor vehicle tort filings in US federal courts reached 6,809 in 2024, the highest annual total in 30 years. The average plaintiff award in federal motor vehicle tort cases rose from US$377,000 during 1995 to 2004 to US$681,000 during 2015 to 2024.
“The data show a growing disconnect between motor vehicle tort litigation and underlying claims frequency,” said Sean Kevelighan, CEO of Triple-I.
A separate Triple-I/CAS study estimated that legal system abuse drove US liability insurance losses higher by between US$231.6 billion and US$281.2 billion over the decade ending in 2024, with personal auto liability accounting for US$91.6 billion to US$102.3 billion of that total. The litigation trend is not confined to the US - social inflation and rising plaintiff awards have been a growing concern for casualty underwriters and the brokers placing those risks in markets including the UK, Canada and Australia.
Chubb’s P&C underwriting income fell 8.8% to US$2.06 billion, according to the company’s Q3 press release. AIG’s general insurance underwriting income dropped 29% to US$564 million. Travelers posted a combined ratio of 86.8%, an improvement from 87.3% a year earlier, with underwriting gains rising to US$1.43 billion.
AIG’s North America commercial underwriting income fell 57% to US$167 million, with its combined ratio rising to 92.9% from 82.6%, driven by higher catastrophe charges and less favourable prior-year reserve development. The Hartford’s middle and large commercial segment saw its underlying combined ratio climb to 99.5% from 91.4%, which the company attributed to a higher workers’ compensation loss ratio and higher non-catastrophe property losses.
Chubb’s North America commercial combined ratio rose to 86.3% from 81.5%. Travelers was an outlier, with its business insurance combined ratio at 90.9% and underwriting gains rising year over year.
AM Best data showed that the US P&C industry’s first-half 2026 underwriting income nearly tripled to US$31.2 billion in the strongest half-year result in years, but the Q3 carrier reports suggest that casualty loss costs and reserve movements are beginning to pressure the margins behind those aggregate figures.
For the first nine months of 2026, Berkshire’s underwriting earnings totalled US$4.8 billion, down from US$5.7 billion in the prior-year period. Insurance float stood at approximately US$178.5 billion as of September 30, 2026, an increase of about US$2.1 billion since year-end 2025. Insurance investment income fell to US$2.73 billion for Q3, down approximately 14% from US$3.18 billion a year earlier, driven largely by lower short-term interest rates.
Berkshire, which overtook Allianz as the world’s largest insurer by assets earlier in 2026, cautioned that “the amount of investment gains (losses) in any given quarter is usually meaningless and delivers figures for net earnings per share that can be extremely misleading to investors who have little or no knowledge of accounting rules.”
