OMAHA, Neb.—Berkshire Hathaway Inc.’s two reinsurance operations reported a lower underwriting profit during 2010, the Omaha, Neb.-based company said in its annual report released Monday.

General Re Corp. unit reported $452 million in underwriting profit for 2010, a 5.3% decline from 2009. Property/casualty premiums written totaled $2.92 billion, a 5.4% decline. Life and health premiums written increased 3%, to $4.71 billion.

Overall, Gen Re said its revenues were $5.69 billion in 2010, a decline of 2.3% from 2009.

Gen Re incurred $339 million in catastrophe losses last year, primarily from earthquakes in Chile and New Zealand as well as weather-related losses in Australia, Europe and New England, according to the annual report.

Its Berkshire Hathaway Reinsurance Group reported a 29.6% decline in underwriting profit, which fell to $176 million. Revenues increased 35.3% to $9.08 billion. The company said within the group, catastrophe and individual risk premiums written were about $84 million in 2010, a 19.5% increase over the previous year.

“The level of business that we write in a given period will vary significantly due to changes in market conditions and our management’s assessment of the adequacy of premium rates,” Berkshire Hathaway said in the report.

“We constrained the volume of business written in 2010 as premium rates have not been attractive enough to warrant increasing volume. However, we have the capacity and willingness to write substantially more business when appropriate pricing can be obtained,” the report said.

In addition, underwriting results from catastrophe and individual risk businesses in 2010 included estimated losses of $322 million that arose “from several significant property catastrophe and casualty loss occurrences” in 2010, while there were no significant cat losses in 2009.

The Berkshire Hathaway Primary Group, which underwrites multiple lines of property/casualty policies for primarily commercial accounts, increased its underwriting profit 219% to $268 million. Revenues decreased 4.3% to $1.7 billion.

The annual report also includes extended praise of executives of Gen Re and Berkshire Hathaway Reinsurance Group.

On Gen Re, the report said a sound insurance operation requires four disciplines: an understanding of all exposures that might cause a policy to incur losses, a conservative evaluation of the likelihood of any exposure causing a loss, setting premiums, and “the willingness to walk away if the appropriate premium can’t be obtained.”

“Many insurers pass the first three tests and flunk the fourth,” according to the annual report. Gen Re Chairman and CEO Franklin Montross IV “has observed all four of the insurance commandments and it shows in his results,” says the report.

Discussing the reinsurance group, the annual report said its Stamford, Conn-based president, Ajit Jain, “insures risks that no one else has the desire or the capital to take on. His operation combines capacity, speed, decisiveness and, most important, brains in a manner that is unique to the insurance business. Yet he never exposes Berkshire to risks that are inappropriate in relation to our resources…Even kryptonite bounces off Ajit.”

Berkshire overall reported net earnings of $12.97 billion, a 61% increase. Revenues increased $136.19 billion, a 21.1% increase.