The question is whether individual investors should follow Berkshire’s lead<\/a>.<\/p>\n Image source: Getty Images.<\/p>\n Why Berkshire likes insurance businesses<\/p>\n Insurance has always been the foundation of Berkshire Hathaway’s success.<\/p>\n The company’s insurance subsidiaries generate billions of dollars in premium income each year, creating what Buffett calls “float.” This is money that’s invested before claims are paid. That float has helped Berkshire build one of the world’s largest investment portfolios and acquire dozens of businesses over the past six decades.<\/p>\n As a result, it’s safe to say that Buffett knows how to identify high-quality insurance operators.<\/p>\n And this is probably one reason Berkshire has steadily expanded its investments in Japan.<\/p>\n While investors often focus on Berkshire’s stakes in Japanese trading houses, the Tokio Marine investment suggests Buffett also sees opportunity in Japan’s insurance sector.<\/p>\n A business built on underwriting discipline<\/p>\n Tokio Marine has developed a reputation for underwriting discipline, a trait Buffett has consistently favored. Insurance companies make money from investment income and underwriting profits. The best insurers do both.<\/p>\n Tokio Marine has demonstrated a long history of underwriting profitability, with many of its core insurance operations consistently reporting combined ratios below 100. In the insurance industry, a combined ratio below 100 indicates that underwriting operations are profitable before investment income is taken into account.<\/p>\n That’s particularly notable given rising catastrophe losses, inflation, and higher reinsurance costs across the global insurance industry in recent years.<\/p>\n Tokio Marine is global<\/p>\n Despite its name, Tokio Marine isn’t simply a bet on Japan. The company has spent years expanding through acquisitions across North America, Europe, and Asia, and today its international insurance operations contribute a significant share of overall earnings.<\/p>\n And that international expansion has helped fuel strong financial results. In 2025, Tokio Marine reported nearly $7 billion in annual net income. That’s up around 45% from $4.8 billion in 2024. The company has also continued to return capital to shareholders through dividend increases and share repurchases, while targeting mid-teen returns on equity.<\/p>\n For fiscal 2026, Tokio Marine reported adjusted net profit of $4.47 billion, up from approximately $3.8 billion in the prior-year period, representing 17% year-over-year growth.<\/p>\n Should you follow National Indemnity?<\/p>\n No investment is guaranteed to succeed, even one backed by Berkshire Hathaway<\/a>. Still, Tokio Marine combines several attractive traits: a leading market position, disciplined underwriting culture, global diversification, strong profitability, and shareholder-friendly capital allocation.<\/p>\n The valuation is also reasonable. Shares currently trade for roughly 14 times forward earnings, a modest multiple for a company generating double-digit earnings growth, buying back stock, and producing billions in annual profit.<\/p>\n If you’re looking beyond domestic financial stocks, Tokio Marine’s American depositary receipt offers one way to gain exposure to a high-quality global insurer.<\/p>\n Should you buy stock in Tokio Marine right now?<\/p>\n Before you buy stock in Tokio Marine, consider this:<\/p>\n The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks<\/a> for investors to buy now\u2026 and Tokio Marine wasn\u2019t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.<\/p>\n Consider when Netflix made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation, you\u2019d have $472,852!* Or when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you\u2019d have $1,317,207!*<\/p>\n Now, it\u2019s worth noting Stock Advisor\u2019s total average return is 984% \u2014 a market-crushing outperformance compared to 210% for the S&P 500. Don’t miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.<\/p>\n See the 10 stocks \u00bb<\/a><\/p>\n *Stock Advisor returns as of May 27, 2026. <\/p>\n Jeff Siegel<\/a> has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy<\/a>.<\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":"Key Points Berkshire Hathaway’s $1.8 billion stake signals confidence in Tokio Marine. Underwriting discipline helps drive consistent insurance…\n","protected":false},"author":2,"featured_media":29772,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[6169,23195,23194,23197,23196,23198,8,17,23199,1351,23200],"class_list":["post-29771","post","type-post","status-publish","format-standard","has-post-thumbnail","category-japan","tag-futures","tag-index-market-quote","tag-index-market-quotes","tag-index-market-symbol","tag-index-market-symbols","tag-indices","tag-japan","tag-japanese","tag-nvda","tag-nvidia-corp","tag-the-globe-and-mail"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/japan\/wp-json\/wp\/v2\/posts\/29771","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/japan\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/japan\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/japan\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/japan\/wp-json\/wp\/v2\/comments?post=29771"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/japan\/wp-json\/wp\/v2\/posts\/29771\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/japan\/wp-json\/wp\/v2\/media\/29772"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/japan\/wp-json\/wp\/v2\/media?parent=29771"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/japan\/wp-json\/wp\/v2\/categories?post=29771"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/japan\/wp-json\/wp\/v2\/tags?post=29771"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"Buildings](\"https:\/\/barchart-news-media-prod.aws.barchart.com\/FC\/4f8ecdac2114d27838f15802752f347f\/%3Furl%3Dhttps%253a%252f%252fg.foolcdn.com%252feditorial%252fimages%252f869086%252fgettyimages-1489195906.jpg%26amp%3Bw%3D700\"\/)
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