Bill Ackman, billionaire hedge fund investor, in February said his proposal to boost his stake in Howard Hughes Inc. (NYSE:HHH) would allow him to create a "modern-day" version of Berkshire Hathaway (BRK.A) (BRK.B), the insurance giant and investing behemoth built by legendary investor Warren Buffett.

In an interview on CNBC on Monday, Ackman said Howard Hughes (NYSE:HHH) might either acquire or build an insurance company. He pointed out that "a huge enhancement" to Berkshire Hathaway's returns over time is that Buffett built a profitable insurance company that generates, basically, free money, called "float."

"The benefit of building an insurance company inside one inside a diversified holding company is that "it gives you a lot more flexibility in what you can invest the insurance company's assets in," he said. "If you're a pure-play insurer, you can't take that much risk. You basically buy fixed-income securities."

"So that model has not gone unnoticed by us... It's highly likely, we'll build or buy an insurance company," Ackman said.

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