[zeddie]

Buffett (via Berkshire Hathaway) has made huge amounts of money selling insurance against catastrophes. This includes natural disasters such as earthquakes, tsunamis, and floods, as well as other catastrophic events including terrorism.

[pepr]

This also implies he has vested interest in convincing people more catastrophes are on the way to sell more insurance.

[widdershins]

"You will definitely suffer a terrorist attack" certainly sounds like something that a person who sells insurance would say.

[uptown]

You realize insurance companies make the most money by selling policies that never get exercised, right?

[zeddie]

Yes, of course. I was pointing out that Buffett has thought more carefully about terrorism risks than most people, since his business has written very large insurance policies providing (limited) terrorism coverage.

[serge2k]

I'm sure he has thought very carefully about how to maximize his profits be convincing people they need terrorism insurance .

[Spooky23]

Acts of war and nuclear disasters are excluded from insurance.

[zeddie]

Buffett's insurance business took a $2.4 billion underwriting loss from the 9/11/2001 terrorist attacks. The insurance industry as a whole paid $33 billion in claims (in 2001 dollars).

[gergles]

Which is why acts of 'terrorism' are no longer covered under almost any insurance policy unless you pay through the nose for an additional rider.

[zeddie]

Right, you probably wouldn't get terrorism coverage as part of your homeowner's policy. However, terrorism insurance is big business! Berkshire Hathaway has extended coverage to airlines, the World Cup, the Sears Tower, etc.

[Spooky23]

That's because terrorism wasn't specifically defined as an "act of war" for general risk policies under the underwriting standards of the time. (although anything nuke has been excluded for many years) War requires a nation-state actor. Terrorism is a broader concept.