Each day, Benzinga takes a look back at a notable market-related moment that occurred on this date.
On Feb. 22, 1967, famed Berkshire Hathaway Inc. CEO Warren Buffett invested $8.4 million in National Indemnity Company and National Fire and Marine Insurance Company.
Where The Market Was
The S&P 500 was trading at 87.34 and the Dow Jones Industrial Average was at 844.10.
What Else Was Going On In The World?
In 1967, the Beatles released “Sgt. Pepper’s Lonely Hearts Club Band” and Thurgood Marshall was confirmed as the first African American Supreme Court justice. The average American earned $7,300 per year.
Buffett Enters The Insurance Business
Warren Buffett has made billions investing in a wide range of companies, but Berkshire is, at its core, an insurance company. Buffett became interested in the insurance business at a young age after learning that his investing mentor Benjamin Graham was on the board of GEICO.
Buffett bought his first stake in the insurance business in 1967 at the age of 37 with National Indemnity Company and National Fire and Marine Insurance Company.
In 1996, Berkshire acquired 100 percent of GEICO, which is now one of three major Berkshire insurance subsidiaries, along with Berkshire Hathaway Reinsurance and General RE. Berkshire’s insurance businesses had a combined float of $91.6 billion and a combined annual profit of $2.1 billion as of 2016.
Since 1996. GEICO’s market share has expanded from about 2.5 percent to around 12 percent.
By Wayne Duggan
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