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Northstar Financial Services (Bermuda) Ltd. (In Provisional Liquidation) www.northstarfinancialservices.bm

FREQUENTLY ASKED QUESTIONS Appointment of Provisional Liquidators By order of the Supreme Court of Bermuda, dated 25 September 2020, Rachelle Frisby and John Johnston of Deloitte Ltd. were appointed as Joint Provisional Liquidators (“JPLs”) of Northstar Financial Services (Bermuda) Ltd. (“the Company”).

The Purpose of the liquidation The Bermuda Monetary Authority presented a winding up petition against the Company and subsequently applied to the Supreme Court of Bermuda (“Bermuda Court”) for the appointment of JPLs whose function is to safeguard the Company’s assets and ascertain their financial positions. Accordingly, the JPLs have started their investigations into the affairs of the Company. As part of this, they are, amongst other duties: • • • • •

Safeguarding the Company’s assets; Protecting policy holders’ interests; Looking to understand the solvency status of the Company’s various accounts; Understanding the full and current financial position of the Company’s and reporting their findings to the Authority, the Court and the Company’s stakeholders; and Undertaking statutory required investigations into the Company’s affairs.

The winding-up hearing has been adjourned to 5 February 2021.

What is the current status? The JPLs are at the early stage of their assessments of the status of the Company. They are continuing to review the solvency status and will provide a further update when they are in a position to do so.

When will I get money back and how much will I receive? It is too early in the process for the JPLs to be able to provide a considered timeframe for distributions or an estimate of recoveries. The JPLs have commenced investigations into the affairs and solvency status of the Company and will consider the ongoing viability as a going concern. These investigations are at an early stage and the JPLs are working diligently to safeguard the assets and protect the interests of the policy holders. Should it be determined that the Company is insolvent and requisite winding up Orders are made by the Court, then it would not be unusual for the Company to be in a state of liquidation for a number of years before a liquidator is in a position to pay creditors. This is due to the nature of the business it undertakes and the contingent nature of its liabilities. A Liquidator(s), in accordance with his(their) duties will be mindful of the hardships which policyholders would face if all policies were terminated; therefore, time will be required to investigate potential solutions that may allow the life insurance policies to continue. Please note that there is no ability to obtain insurance against losses incurred by the Company in Bermuda.

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Northstar Financial Services (Bermuda) Ltd. (In Provisional Liquidation) www.northstarfinancialservices.bm

FREQUENTLY ASKED QUESTIONS What happens if I am in a segregated account? If it is determined that the Company has properly established and operated segregated accounts in accordance with the Segregated Accounts Companies Act 2000, those segregated account holders will have a claim against the client money pool held within that specific segregated account. As part of the JPLs’ investigations, attorneys have been engaged to consider the Company’s position regarding segregated accounts and the JPLs will update policy holders in due course. Should a winding-up order be made against the Company, policy holders with non-segregated accounts will have an unsecured claim and are not entitled to make a claim for client monies held in any segregated accounts of which they are not account owners.

Will you be processing redemption / trade requests? At this stage, the JPLs will process all redemption requests into cash. However, the JPLs will not be paying any money to policy holders unless and until such time as we have been able to confirm the solvency position of the Company; determine the status of the segregated accounts; and obtained the sanction of the Bermuda Court to make payment to policy holders. The JPLs will not be processing any trade requests between investment options at this time. The JPLs will communicate any changes on this position to all distributors and policy holders as appropriate.

Can I submit a claim to the JPLs? At this stage, the JPLs are not seeking claims from policy holders. Should a winding-Up Order be made against the Company, eligible segregated and non-segregated policy holders (where applicable) will be asked to submit claims in the proceedings. At the appropriate time, we will issue further correspondence providing claim forms as required to all policy holders.

Where can I find further information from the JPLs? Please continue to liaise with your distributors in the first instance. The JPLs will be providing updates as often as possible to all creditors and policy holders. However, should you wish to contact the JPLs directly, please do so at cbcbmnfs@deloitte.com

Profile for Northstar Financial Services (Bermuda) Ltd

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