Providing Risk & Capital Management Solutions for the Life Insurance Industry. March 2007

Transcription

1 Providing Risk & Capital Management Solutions for the Life Insurance Industry March 2007

2 What We Do Focus our intellectual capital to provide solutions using Traditional Reinsurance and Run Off Solutions to help U.S. life insurers actively manage their risks and capital Offer a proactive focus to solving our clients problems while meeting our return parameters Infuse integrity, professionalism, and responsiveness in everything that we do 2

3 Introduction Holding company formed in September 2004 $628 million of equity capital commitments through a private placement Primary sponsor, Trident III, L.P., committed $200 million Other major investors include Vestar Capital Partners and Friedman Fleischer & Lowe Transaction closed December 2004 Filling a market need by replacing capacity lost to consolidation or withdrawal with financial and intellectual strength U.S. team based in Wilton, CT Separate offshore team in Hamilton, Bermuda Received A.M. Best rating of A- 3

4 Strengths Funded with $628 million in unencumbered capital Respected management with proven track record Executive team comprised of industry leaders Experienced senior management with strong multi-disciplinary backgrounds Disciplined risk takers Creating win-win solutions for our partners Never sacrifice quality for volume Focused business plan Traditional life reinsurance Runoff solutions Simplified straight-through administrative processing 4

5 Solutions Offering Traditional Reinsurance of the mortality risk on life insurance policies written in the U.S. by primary insurers New automatic capacity Will consider general account accumulation products No facultative facility Wilton Re will not dilute its focus No guaranteed asset elements of variable products No accident & health No non-u.s. clients 5

6 Solutions Offering Run Off Acquisition of closed blocks or entire companies Enables life insurers to unlock value in non-core businesses Optimizes returns by reallocating trapped capital Allows insurers improved management focus on core business Willingness to take responsibility for the administration of the business Frees seller of the need to maintain legacy systems Eliminates expense risk for clients 6

7 Working With Us Required information for a traditional bid Pricing assumptions Mortality and lapse studies Underwriting guidelines Policy forms, commissions and understanding of distribution Copies of the last three reinsurance audits of underwriting, claims and administration Required information for a Run Off bid Pricing, lapse and investment assumptions Actuarial appraisal or equivalent Valuation of other assets and liabilities Typical due diligence information A partnership attitude with the intention of developing win-win scenarios 7

8 Risk and Capital Management Principles: Framework embedded in business processes not separate Risk identification/control design/remediation are responsibilities of executives Data is key information management strategy designed to respond to risk and capital management objectives Expected mortality retentions per life $1 million $13 million retrocession capacity Collateral and liquidity management Interim LOC facility established Longer-term securitization platform in place for XXX risks 8

9 Asset Management Principles: Avoid undue credit risk Generally match the duration of assets and liabilities No desire for exotic investments Zero allocation to equity securities Focus on understanding and managing liabilities Portfolio management, investment accounting and reporting services are being provided by BlackRock under a multi-year agreement 9

10 Executive Management Chris C. Stroup, Chairman and CEO Led Swiss Re s North American life reinsurance business from Led Swiss Re s Admin Re business which executed over 30 transactions with aggregate capital invested of $2.4 billion CFO and Director of Life Re Corporation from Partner at Ernst & Young LLP through

11 U.S. Staffing Chairman & CEO Chris Stroup CMO Don Araldi CPO Mike Greer SVP Runoff Perry Braun General Counsel Mark Sarlitto CFO Mike Fleitz CTO Andy Wood COO Enrico Treglia CUO David Van Der Beek 11

12 Legal Entity Structure 12

13 A.M. Best Press Release Page 1 of 1 Press Release - FEBRUARY 07,2005 A.M. Best Assigns Ratings to Wilton Re CONTACTS: Public Relations Analyst Jim Peavy William Pargeans (908) , ext (908) , ext james.peavy8ambest.com [email protected] Rachelle Striegel (908) , ext FOR IMMEDIATE RELEASE OLDWICK, N.J., FEBRUARY 07,2005 A.M. Best Co. has assigned a financial strength rating of A- (Excellent) and an issuer credit rating of "a-" to Wilton Re Bermuda Limited (Bermuda) and Wilton Reassurance Company (together k/a Wilton Re) (Plymouth, MN). Wilton Reassurance Company is currently named Prudential Select Life Insurance Company of America. The name is expected to be changed to Wilton Reassurance shortly. Both operating companies are organized under Wilton Re Holdings Limited (Bermuda) and operate as Wilton Re. The outlook on the ratings is stable. Wilton Re is a start-up operation, focused on the U.S. life reinsurance marketplace, which has undergone significant consolidation, resulting in reduced capacity and higher prices. Accordingly, A.M. Best views Wilton Re's business model positively. Wilton Re has firm capital commitments totaling about $628 million from a number of investors, enabling it to underwrite and strongly support a meaningful volume of traditional life mortality business. Moreover, Wilton Re's business model includes complementary administrative reinsurance whereby reinsurance and stock transfers will be employed to acquire discontinued and subscale blocks of business. Offsetting factors include the lack of operating history and the uncertainties surrounding the successful execution of its business plan. In addition, A.M Best believes the rate of growth of the U.S. life reinsurance market has slowed, which may pressure Wilton Re's longer term growth prospects. For Best's Ratings, an overview of the rating process and rating methodologies, please visit Best's Rating Center. For current Best's Ratings, independent data and analysis on more than 330 reinsurance companies, please visit Best's Reinsurance Center. A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. View a list of companies related to this press release. The list will include Best's Ratings along with links to additional company specific information including related news and reports. Copyright 2005 by A.M. Best Companv. Inc. ALL RIGHTS RESERVED No part of this report may be distributed in any electronic form or by any means, or stored in a database or retrieval system, without the prior written permission of the A.M. Best Company. Refer to our terms of use for additional details.

14 Wilton Re Press Release GREENWICH, Conn., Dec. 21 /PRNewswire/ -- Wilton Re U.S. Holdings, Inc. announced today that its Bermuda-based parent company, Wilton Re Holdings Limited, has raised more than $600 million in capital commitments through a private placement of its common stock. The Wilton Re group was formed in order to provide a new source of life reinsurance capacity to life insurers in response to the continuing consolidation in the U.S. life reinsurance industry. The sponsoring investors of Wilton Re Holdings Limited are Trident III, L.P., a private equity fund managed by MMC Capital, Inc., and Chris C. Stroup. Additional capital has been provided by private equity funds managed by Vestar Capital Partners and Friedman Fleischer & Lowe, among others. The Wilton Re group management team is led by Chris C. Stroup, as Chairman of Wilton Re Holdings Limited and its U.S. subsidiaries, and John E. Tiller, as CEO of Wilton Re U.S. Holdings, Inc. and its subsidiaries. Previously, Mr. Stroup served as CEO of Swiss Re Life & Health North America. Mr. Tiller, who has over 30 years of experience in the life insurance industry, was previously the head of ERC Life Re. In addition, Mr. Tiller co-authored Life, Health & Annuity Reinsurance, the leading reference book in the industry. The Wilton Re group's reinsurance business will focus on U.S. traditional mortality business and life insurance runoff solutions. Wilton Re U.S. Holdings, Inc. expects to close the purchase of a licensed U.S. insurance company shortly, out of which it plans to conduct business. Mr. Stroup said, "Wilton Re offers the marketplace a compelling combination of a substantial, unencumbered capital base aligned with a capable management team. We look forward to becoming a major presence in the U.S. life reinsurance marketplace." The shares of common stock of Wilton Re Holdings Limited have not been registered under the United States Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. This press release does not constitute an offer to sell or the solicitation of an offer to buy any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offering would be unlawful. MMC Capital, Inc. is a global private equity firm with 20 years of private equity experience. MMC Capital serves as the manager of the Trident Funds, which have raised more than $3 billion in committed capital to make investments in the insurance, employee benefits and financial services industries. MMC Capital has been the sponsor of more than fifteen insurance companies, including ACE Limited, XL Capital Ltd. and AXIS Capital Holdings Limited. Contact: Chris Stroup Wilton Re U.S. Holdings, Inc. [email protected] (203) CONTACT: Chris Stroup of Wilton Re U.S. Holdings, Inc., , [email protected]