BCRH Blue Capital Reinsurance Holdings Ltd

As previously disclosed on July 25, 2019, the Board of Directors (the “Board”) of Blue Capital Reinsurance Holdings Ltd. (the “Company”) decided to cease the Company’s active operations and pursue an orderly run-off of the Company’s liabilities and in-force portfolio and return capital to shareholders as the Company winds up its operations. In light of the Board’s decision, on October 25, 2019, the Bermuda Monetary Authority (“BMA”) amended the license of the Company’s wholly-owned subsidiary, Blue Capital Re Ltd. (“Blue Capital Re”) to include the following restrictions:

1)    Blue Capital Re shall not, without obtaining the prior written approval of the Bermuda Monetary Authority, effect any contracts of insurance or reinsurance.

2)    Blue Capital Re shall not, without obtaining prior written approval of the BMA, declare and/or pay any dividends and/or make any capital contributions to Blue Capital Re’s parent, shareholders or affiliates.

The Company is dependent upon dividends and distributions from its subsidiaries, including Blue Capital Re. Blue Capital Re intends to seek the BMA’s advance approval of each planned distribution to the Company’s shareholders. To the extent Blue Capital Re is unable to obtain the BMA’s approval, such shareholders’ distributions may be prevented or delayed until such time as Blue Capital Re receives the BMA’s approval.

The Company is amending as follows the additional risk factor entitled “Regulatory restrictions on distributions and the return of capital may impact our ability to fund future distributions to shareholders” listed in its Current Report on Form 8-K filed on July 25, 2019 to update the risk factor previously disclosed in such Current Report on Form 8-K.

Regulatory restrictions on distributions and the return of capital may impact our ability to fund future distributions to shareholders.

In order to distribute capital to our shareholders when it becomes available after the settlement of existing liabilities and expenses, the Company will be reliant on the ability of its subsidiary, Blue Capital Re Ltd., to dividend adequate funds to the Company. Under Bermuda law, after October 25, 2019, Blue Capital Re Ltd. may not pay any dividend to the Company without prior approval from the Bermuda Monetary Authority. We cannot offer any assurance that we will receive such approval from the BMA. Absent receipt of dividends from Blue Capital Re Ltd., the Company’s ability to make distributions to the Company’s shareholders may be prevented or delayed.