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A.M. Best Affirms Rating of Northwind Holdings, LLCA.M. Best has affirmed the issue rating of "a" on $800 million of Series A Floating Rate Insured Notes due 2037 (notes) issued by Northwind Holdings, LLC (Northwind Holdings), a Delaware limited liability company and wholly owned subsidiary of Unum Group (Unum) (Chattanooga, TN). The outlook for the rating is stable. Northwind Holdings was formed for the limited purpose of holding the stock of Northwind Re, Inc. (Northwind Re), issuing the notes and engaging in other activities incidental to the performance of its duties. Northwind Holdings is the sole shareholder of Northwind Reinsurance Company, a special purpose financial captive insurance company domiciled in Vermont. Northwind Re was established to provide reinsurance coverage to three Unum subsidiaries, Provident Life and Accident Insurance Company, The Paul Revere Life Insurance Company and Unum Life Insurance Company of America, as well as to facilitate the funding of a portion of the capital required to support a closed block of individual disability income policies. A.M. Best's rating action takes into consideration the adequacy of the excess cash flows at Northwind Re available to be transferred as dividends to Northwind Holdings to service the notes; the ability to meet or exceed certain benchmarks (e.g.,principal note payment, dividend distribution, reserve balances) relative to its plan and forecast; the performance of its investment portfolio, which primarily consists of investment-grade securities and is the primary source of funds to pay ongoing claims; and Unum's operating subsidiaries' current financial strength ratings of A (Excellent) and issuer credit ratings of "a". No consideration was given for payment assurance or support provided by MBIA Insurance Corporation, the financial guarantor, which ensures the timely payment of scheduled interest and the repayment of principal at maturity to the note holders. Northwind Holdings' issue rating and outlook may come under negative pressure if an unfavorable earnings trend develops over a prolonged period or if certain benchmarks are not achieved or deteriorate relative to its plan and forecast. However, the issue rating and outlook could benefit if a favorable trend in the company's operating performance increases or certain benchmarks exceed the plan and forecast. This press release relates to rating(s) that have been published on A.M. Best's website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please visit A.M. Best's Ratings & Criteria Center. A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com. Copyright © 2015 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.
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