Features and Benefits of Principal SVC

Important Notes:

1. Principal MPF Scheme Series 800 ("Scheme") is an MPF Scheme.

2. Each of the Prinicipal Capital Guaranteed Fund and the Principal Long Term Guaranteed Fund under this Scheme invests solely in an approved pooled investment fund in the form of an insurance policy issued by Principal Insurance Company (Hong Kong) Limited ("Principal"). The guarantee is also provided by Principal. Your investments in the Principal Capital Guaranteed Fund and the Principal Long Term Guaranteed Fund, if any, are therefore subject to the credit risk of Principal. Please refer to the "Principal Capital Guaranteed Fund" and the "Principal Long Term Guaranteed Fund" sections of the Principal Brochure of the Scheme for details of the credit risk, guarantee features and guarantee conditions.

3. Principal, the Guarantor of the Principal Long Term Guaranteed Fund under this Scheme, will only provide a guarantee of capital and a prescribed guarantee rate of return in certain specified circumstances. Please note that you may lose the guarantee entitlement if you have elected to transfer your accrued benefits in the Scheme (i) from an account within the Scheme to another account within the Scheme; (ii) from the Principal Long Term Guaranteed Fund to another constituent fund in the Scheme; or (iii) to another MPF scheme as described in the sub-section (B) "Transferring benefits from or within the Scheme" under the section "Employee's Choice - Transferring accrued benefits to and from the Scheme" of the Principal Brochure. Please refer to page 12 of the Principal Brochure under the section "Provision of Guarantee" for details of the guarantee conditions.

4. Principal, the Guarantor of the Principal Capital Guaranteed Fund under this Scheme, will provide a guarantee to ensure the unit value of the fund will never decrease. Under the indirect charge option (i.e. the Class I Units after 30 December 2011), part of the management fee is asset based which is deducted from the net asset value of the fund, while the remaining part is payable by deducting units from member's account. As such, capital may not be guaranteed in absolute term for scheme members under the indirect charge option before 30 December 2011. For details, please refer to the sections "How the guarantee works" and "Fees and Charges" of the Principal Brochure of the Scheme.

5. Investment in the Principal HK Dollar Savings Fund is different from placing deposits with a bank or deposit-taking company and is not protected by the Deposit Protection Scheme. Investments in this Fund will be subject to investment risks.

6. The Principal MPF Conservative Fund under this Scheme is not a guaranteed fund and does not guarantee the repayment of capital. Fees and charges of a MPF conservative Fund can be deducted from either (i) the assets of the fund or (ii) members' account by way of unit deduction. This Fund uses method (i) and, therefore, unit prices/net asset value/fund performance quoted have incorporated the impact of fees and charges.

7. You should consider your own risk tolerance level and financial circumstances before making any investment choices. When, in your selection of funds, you are in doubt as to whether a certain fund is suitable for you (including whether it is consistent with your investment objectives), you should seek financial and/or professional advice and choose the fund(s) most suitable for you, taking into account your own circumstances.

8. In the event that you do not make any investment choices, please be reminded that any contributions made and/or benefits transferred into this Scheme will be invested into the Principal HK Dollar Savings Fund, and such fund may not necessarily be a suitable investment for you.

9. Investment involves risks. The value of the funds may go up or down. You should not invest in reliance on this marketing material alone. You should read the Principal Brochure of the Scheme for further details (including investment policy, risk factors, fee and charges of the constituent funds).

Plan Your Retirement with Principal Special Voluntary Contributions

On top of the mandatory contribution of your MPF Scheme, Principal Special Voluntary Contributions may help prepare you better for retirement. Its potential returns in the long run may assist you progress towards your retirement goals and a well-planned future.

Principal Special Voluntary Contributions offers you:

✓	Diversified investment options
	Principal MPF Scheme Series 800 offers a wide range of constituent fund choices with different investment objectives, investment portfolios and risk/return levels to cater to your needs.

✓	Flexible premium payment options
	You can choose to start regular contributions at HK$500 monthly, or simply pay a minimum lump sum of HK$1,000. You have the flexibility to change your investment portfolio change or withdraw your contributions according to your own needs at any time. (Special Voluntary Contributions Member may withdraw the account balance of not more than four times in each financial year free of charge. Additional withdrawal will be subject to a handling charge of HK$300 for each withdrawal and the said fees will be deducted from the withdrawal value.)

✓	Your own decision
	Any person at or above the age of 18 and below 65 (including employee member, self-employed person and personal account member) is eligible to join Principal Special Voluntary Contributions. Additional contributions and constituent fund selections are made at your own preference. It is independent from your employer, and you can arrange for the service yourself.
✓	Benefits of Dollar Cost Averaging
	Enrolment is easy. Upon completion of the application procedures, you may have the opportunity to benefit according to the "dollar-cost averaging principle" in the long run. (Your money buys more units when the price is lower and fewer units when the price is higher. Over time, the dollar-cost averaging effect averages out the costs of your units and therefore reduces the effects of short-term market fluctuation on your investments.)

Why Principal?

Principal offers you:

l A wide range of constituent fund choices covering different risk/return levels

l Global investment professionals and experts in managing the constituent funds

l Value-added services, including the round-the-clock Principal TeleTouch© interactive voice response system service, Principal MPF internet service, Principal Mobile Application, e-newsletters and clients seminars

Product Features
Product	Principal Special Voluntary Contributions
MPF scheme	Principal MPF Scheme Series 800
Minimum contribution amount	Lump sum: HK$1,000 Monthly regular contributions: HK$500
Payment method	Lump sum: Cheque Monthly regular contributions: Direct debit authorisation (DDA)
Constituent fund switching	Unlimited number of times per year Switching charge: Nil
Withdrawal	Free withdrawal up to four times per year (Special Voluntary Contributions Member may withdraw the account balance of not more than four times in each financial year free of charge. Additional withdrawal will be subject to a handling charge of HK$300 for each withdrawal and the said fees will be deducted from the withdrawal value.)

Fees and Charges

The management fees at the constituent fund level of the constituent funds under the Scheme range from 0.89% up to 2.00% per annum of their net asset value (NAV). The management fees include fees paid to the trustee, custodian, administrator, investment manager (including fees based on fund performance, if any) and sponsor of a scheme for providing their services to the relevant fund. Such fees are usually charged as a percentage of the NAV of a fund.
A guarantee charge of up to 1.00% per annum of NAV is applicable for the Principal Long Term Guarantee Fund. (For details, please refer to the Principal Brochure of the Scheme under the section "Fees and Charges".)

Build your retirement nest egg early with Principal Special Voluntary Contributions.

Issuer of this material: Principal Insurance Company (Hong Kong) Limited