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Newsletter

2004 1st Edition (Other Editions)

1. Knowledge Quiz

Case 1:
Mr. Lee started to save money at the age of 18. He deposits $2,000 every month, with the annual interest rate as 8%, until he turns to 21. Mr. Lee would not withdraw any money from the account until he becomes 65.

Case 2:
Mr. Fong started saving money at 36, having the same interest rate and deposit amount as Mr. Lee does. He deposits money from 35 to 65.

Guess who will have the greater amount of accumulated money in their account eventually?

2.General Knowledge on Insurance

A police officer lent his car to his friend. Unfortunately his friend was suspected of taking drugs before driving and causing injury to the pedestrians and damage to the property of a shop. The Third Party Motor Insurance will provide remedy to the injured part promptly, no matter who is the wrongdoer. Later, the company will claim damages with the car owner for the reason that “the car owner and the driver failed to apply appropriate precautionary measures”. For the damage to the third party's property, the insurance company will use the same reason (as mentioned above), in order to turn down the requisition on remedies. The car owner and the driver have to bear the liabilities to the damage to the third party's properties. Recently, most insurance companies have put an indemnity clause in their insurance policy which indicated the “Exclusion of claims to drink driving” clause. This enables the insurance company to have the right to claim damages directly with the car owner; needless to quote “the car owner and the driver failed to apply appropriate precautionary measures” as the reason.

3.New Product

This time, we are going to introduce you to a plan, especially designed for the protection to common female health problem --- “Pretty Choice”. This plan aims at enhancing protection where the critical illness and the medical reimbursement plan does not cover, for example, in the case of female cancer (early stage) and Systemic Lupus Erythematosus (SLE) with Lupus Nephritis. Moreover, other than hospitalisation charges, these illnesses also incur considerable amount on other kinds of expenditure like medicine, Chinese medication, etc. All those spendings are not included in the scope of coverage in the medical reimbursement plan. “Pretty Choice” provides you with protection to the above illnesses. In normal circumstances, the premium of the “Pretty Choice” is $100, depending on age and health condition. You are welcomed to inquire us for more detail.

4.Assets Management

Some of the retired own a large amount of cash but they only use the interest on their living, unwilling to use the fund lest they should have insufficient fund to use for the rest of their lives. On one hand they can not use all of their assets by the time they are still living. On the other hand, after death, their family members are unable to use the heritage promptly and fully due to certain legal heritage handling procedures. The above problem can be solved if we apply the Annuity to utilize and accommodate assets wisely. First, we guarantee annuity holder to receive retirement pension till decease; second, since the annuity is an insurance product, it is exempt from the heritage handling process, so family members can get the full amount immediately.

5.Answer To the Knowledge Quiz:

Mr. Lee can get $3,104,772. Although Mr. Fung's savings is greater than Mr. Lee's, it turns out that Mr. Fong can only get $3,000,590. This is so called the power of compound interest, which explains the fact that when it comes to money saving, the earlier, the better.