AM Best has assigned a financial strength rating of A+ (Superior) and a long-term issuer credit rating of “aa-” (Superior) to Bermudian-based Wilton Re Overseas Limited.

The outlook assigned to these credit ratings is stable.

AM Best said the entity is being added as a member of the Wilton Re Group, and the stable credit profile of, and continuing support by, the company’s ultimate parent, Canada Pension Plan Investment Board, also shore up the group rating.

The ratings reflect WROL’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, favourable business profile and appropriate enterprise risk management.

The agency said the ratings of the Wilton Re Group are extended to WROL because of the subsidiary’s full integration into the group’s operations and management as it follows the same operating model and risk profile.

Additionally, the ratings are being extended to WROL because of the subsidiary’s strategic importance to the group’s North American market and the entrance into new geographical territories including Europe, as well as its expansion in Bermuda.

WROL will seek life and annuity reinsurance and mergers and acquisition opportunities that support its business model, which provides solutions for clients seeking to cede or sell closed blocks of life insurance business.

AM Best said WROL is targeting growth through episodic transactions.

WROL closed on a $1.5 billion secondary guarantee universal life closed block of business in December. This deal added to the company’s existing book of business, which includes a 25 per cent economic and voting interest in a life settlement fund and its investment in Clara-Pensions Group Limited.

WROL is not expected to be a primary driver of the Wilton Re Group’s assets under management, but the subsidiary is expected to be a meaningful contributor to the group’s financial results over time, AM Best said.