Buffett on whether he'd insure SpaceX mission: I'd have a 'different rate if Elon was on board'
Warren Buffett, CEO of Berkshire Hathaway (BRK-A, BRK-B), has a message about the insurability of Elon Musk's future SpaceX missions. "It would depend on the premium," joked the Oracle of Omaha Saturday during Berkshire's annual general meeting, streamed live exclusively from Yahoo Finance.
During an extensive question-and-answer session with Buffett and Berkshire Hathaway Vice Chairs Charlie Munger, Ajit Jain and Greg Abel, one shareholder asked if the conglomerate would be open to a call from Elon Musk to SpaceX to insure future mission and colonization of Mars.
The question was directed to Jain, who heads Berkshire's insurance business and is seen as a possible frontrunner to succeed Buffett as CEO.
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"In particular, he would like insurance to cover SpaceX's heavy rocket, capsule, payload and human capital," the shareholder said of the hypothetical request. "Would you subscribe to part of such a company?"
Without hesitation, Jain replied, “This is easy. No thanks. I'll pass."
SpaceX founder Elon Musk arrives before the SpaceX Falcon 9 rocket launches with the Crew Dragon capsule prior to launching its NASA commercial crew mission at the Kennedy Space Center in Cape Canaveral, Florida, USA on April 23, 2021 . REUTERS / Joe Skipper
Buffett, who like Musk is one of the richest people in the world, joked that he was more accessible to reassuring SpaceX's goal of landing people on Mars, which he pledged to be by 2024.
“Well, I'd say it would depend on the premium. And I'd say I'd probably have a slightly different tariff if Elon were on board or not, ”added Buffett, referring to the famous mercury CEO of SpaceX and the electric car company Tesla (TSLA).
Buffett went on to explain why his rate would change based on Musk's listing on the mission passenger list: “No, it makes a difference! When someone asks to insure something, that means bringing skin into play. "
However, Jain did not want to let the scenario complete without reaffirming his more conservative approach. "In general, I would be very concerned about writing an insurance policy with Elon Musk on the other side," he joked.
"Tell Elon to call me instead of Ajit," said Buffet with the last word.
While Berkshire Hathaway wholly owns or has ownership interests in a number of industries from technology to fast food to underwear, insurance is one of its "family gems" and "the core of Berkshire," Buffett said in his annual letter to shareholders this year.
For his part, Musk and his companies are doing everything they can to conflict with Tesla's regulators over Tesla's autonomous driving technology and SpaceX's rocket launches. While NASA SpaceX placed an order for a lunar spaceship last month, Musk's company was ordered on Friday to postpone the project while competing bidders contest the order.
SpaceX made the news the day after the Berkshire meeting. Early Sunday morning, SpaceX successfully returned a group of international astronauts to Earth in the company's Crew Dragon "Resilience" capsule. The four astronauts landed in the Gulf of Mexico near Panama City, Florida after spending about six months on the International Space Station.
Read more about Berkshire Hathaway:
Why Warren Buffett invested in Coca-Cola and its lesson
21 brilliant quotes from legendary investor and polymath Charlie Munger
Warren Buffett's 25 Best Quotes About Business, Investing, and Life
What makes Berkshire Hathaway, headed by Buffett, a "Distinctive Company in America": Management Expert
Alexis Keenan is a legal reporter at Yahoo Finance and a former litigation attorney. Follow Alexis Keenan on Twitter @alexiskweed.
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