The actual experience is worse than what it had assumed
The actual experience is better than what it had assumed
The liabilities are under/over valued
The assets are valued in a conservative manner
✅ The correct answer is 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.
When the actual experience of an insurance company is better than what it had assumed, the result would be surplus (profit) for the company.