AM Best Affirms Issue Credit Rating of Weston2044 LLC Series Hannover, No. 1 Variable Funding Credit Linked Note

OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has affirmed the Long-Term Issue Credit Rating (Long-Term IR) of “a” (Excellent) on the $1.654 billion, 6.00% Series Hannover, No. 1 variable funding credit-linked note (note), due Oct. 1, 2044, of Weston2044 LLC (Weston2044), a Delaware limited liability company (issuer). The outlook of this Credit Rating (rating) is stable.

The note is in consideration of a variable funding surplus note (VSN) issued by Redding Reassurance Company 4 LLC (Redding Re 4), a Missouri-domiciled special purpose life reinsurance captive insurer and a direct wholly owned subsidiary of Wilton Reassurance Company (Wilton Reassurance). The note supports the excess reserves for a block of universal life secondary guarantee insurance (ULSG) business. Wilton Reassurance assumes the ULSG business via a coinsurance arrangement with Pruco Life Insurance Company, and retrocedes to Redding Re 4. The note has a face amount equivalent to that excess reserve balance, which is also equivalent to the face amount of the corresponding VSN for which the note is exchanged. Wilton Reassurance’s retrocession to Redding Re 4 is on a coinsurance funds-withheld basis.

The note and the VSN have the same interest rate, which is subject to a netting arrangement. Concurrent with the issuance of the note, Weston2044 entered into a risk transfer agreement (i.e., cash-settled ISDA swap) with Hannover Life Reassurance Company of America (Bermuda) Ltd. to provide liquidity for any redemption/monetization of the note.

As of June 2025, statutory reserves, economic reserves and excess reserves of the underlying life insurance business pertaining to the note were in line with the projected results.

The rating represents AM Best’s current opinion as to the issuer’s ability to meet its financial obligations to the noteholders when due. The rating primarily takes into consideration the following: Hannover Life Reassurance Company of America (Bermuda) Ltd.’s Long-Term Issuer Credit Rating (Long-Term ICR) of “aa” (Superior) as the swap counterparty to Weston2044; Wilton Reassurance’s Long-Term ICR of “aa-” (Superior), as the entity provides support for the 250% company action level risk-based capital for Redding Re 4; netting arrangements among transaction parties; the absence of reserves or funds at Weston2044, except funds provided by Redding Re 4; and potential legal risks as it relates to enforceability of the various transaction agreements and potential consolidation issues of various parties.

The Long-Term IR could be upgraded or downgraded, or the outlook revised if material changes occur in the financial condition and ratings of Hannover Life Reassurance Company of America (Bermuda) Ltd. or Wilton Re Group.

AM Best remains the leading rating agency of alternative risk transfer entities, with more than 200 such vehicles rated in the United States and throughout the world. For current Best’s Credit Ratings and independent data on the captive and alternative risk transfer insurance market, please visit www.ambest.com/captive.

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