Berkshire Hathaway’s insurance underwriting business has reported a loss of $US38 million ($51 million) for the second quarter, compared with an operating profit of $US411 million ($554 million) in the corresponding period last year.

The red ink was caused by record damage from storms in Sydney, the Hunter Valley and southeast Queensland in April.

The US investment conglomerate is a reinsurer for Suncorp and IAG.

On a half-year basis, the insurance business has reported an operating profit of $US442 million ($596 million), down from $US872 million ($1.18 billion) in the corresponding period last year.

Overall, Berkshire Hathaway has reported a first-half operating profit of $US8.13 billion ($10.96 billion), up from $US7.86 billion ($10.59 billion).

Net profit was $US9.18 billion ($12.37 billion), down from $US11.10 billion ($14.96 billion).

In June the group acquired a 3.7% stake in IAG for $500 million, and struck a 10-year 20% quota share agreement with the Australian insurer.

Under the agreement Berkshire Hathaway will receive 20% of IAG’s consolidated gross written premium and pay 20% of claims.

The two companies have also agreed on a swap of businesses: IAG will acquire Berkshire Hathaway’s local personal and SME lines, and Berkshire Hathaway will acquire renewal rights to IAG’s large corporate property and liability insurance business in Australia.