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This question belongs to Commerce Insurance

Insurance

?

Surplus would arise in an insurance company, if

A) The actual experience is worse than what it had assumed B) The actual experience is better than what it had assumed C) The liabilities are under/over valued D) The assets are valued in a conservative manner

Answer & Solution

Correct Answer: Option B

When the actual experience of an insurance company is better than what it had assumed, the result would be surplus (profit) for the company.

Question posted by Examveda

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