Berkshire Hathaway's fourth-quarter profit fell sharply, in part on an underwriting loss in its reinsurance business related to life insurance, the company said on Saturday.

Berkshire said it earned $3.05 billion, or $1,846 per Class A share, compared with earnings of $4.38 billion, or $2,656 per share a year earlier.

Revenue rose slightly, though, to $37.96 billion from $36.17 billion in the fourth quarter of 2010.

Berkshire said its reinsurance unit reported a pre-tax underwriting loss of $581 million in the quarter on a life insurance contract, where mortality rates have exceeded assumptions.

The company also reported a sharp decline in investment and derivative gains in the quarter, falling roughly $1 billion from a year earlier.

The conglomerate ended the year with $37.3 billion in cash and equivalents, down about $1 billion from a year earlier.

Book value at year-end was $99,860. Berkshire's share buyback program is capped at 110 percent of book value, well below the stock's close of $119,000 on Friday.

Chief Executive Warren Buffett released his annual letter to shareholders on Saturday.

(Reporting By Ben Berkowitz; Editing by Doina Chiacu)