The surplus in an insurance company is a function of –

A. How Asset is valued

B. How liability is valued

C. How Assets & Liabilities are valued

D. None of the above

Answer: Option C

Solution(By Examveda Team)

The surplus in an insurance company is a function of how Assets & Liabilities are valued. Surplus is also known as net worth or the difference between the market value of assets and the present value of the liabilities and their relationship.