Last month, Warren Buffett lamented in his annual letter to shareholders that Berkshire Hathaway “found little that excites us.” He was referring to ways to use their $144 billion cash position to make an acquisition.

That all changed today.

Buffett’s exciting acquisition target is not GameStop, Zoom, Tesla or anything else that has recently captured investors’ attention. Today, Berkshire Hathaway announced that it was buying…a reinsurance company.

In the same letter, Buffett wrote of the insurance business that it “will never be obsolete, and sales volume will generally increase along with both economic growth and inflation.” That might help explain today’s announcement that Berkshire was buying reinsurance company Alleghany Corporation for $11.6 billion.

It’s a classic Buffett move: invest in what you know, be patient and concentrate your position when appropriate. In this case, Buffett was as a patient as a glacier, saying that Alleghany was “a company that I have closely observed for 60 years.”

Buffett has formerly said that “Diversification is a protection against ignorance. [It] makes very little sense for those who know what they’re doing.” No one knows the insurance business better than Buffett, so it makes sense for him to buy more.

Alleghany is similar to Berkshire in that it’s an insurance conglomerate that also has a division, Alleghany Capital, composed of non-insurance companies. Those include steel fabricator WWSC Holdings, top ten toymaker Jazwares and Wilbert Funeral Services (talk about a recession-proof business!).

As of this writing, Alleghany’s forward P/E ratio is 12.11 compared to the S&P’s forward P/E of 18.2. Barron’s recommended Alleghany last November, quoting a JPM Securities analyst that said it was undervalued. Buffett must have agreed, offering a 29% premium to buy the company.