Question
a.
Surplus is determined at the end of the accounting period, while profit is determined at the beginning of the accounting period.
b.
Surplus is the excess of assets over liabilities, while profit is the excess of income over outgo.
c.
Surplus is always negative, while profit is always positive.
d.
Surplus is a term used in firms, while profit is a term used in life insurance.
Posted under IC38 Life Insurance Agent Exam
Interact with the Community - Share Your Thoughts
Uncertain About the Answer? Seek Clarification Here.
Understand the Explanation? Include it Here.
Q. What is the key difference between "surplus" in life insurance and "profit" in a firm?
Similar Questions
Explore Relevant Multiple Choice Questions (MCQs)
Q. What is the primary purpose of periodic valuation of assets and liabilities in a life insurance company?
View solution
Q. What is the key difference between "surplus" and "strain" in life insurance?
View solution
Q. In the context of life insurance, how is "profit" generally defined for a firm?
View solution
Q. What is the formula to calculate surplus in life insurance?
View solution
Q. What is the primary purpose of distributing surplus in the context of life insurance?
View solution
Q. What is the most common type of bonus in life insurance that is received only at the time of a claim by death or maturity?
View solution
Q. What is a "Terminal Bonus" in the context of life insurance?
View solution
Q. How is the Compound Bonus expressed in life insurance?
View solution
Q. Which method of surplus distribution is adopted in North America, where surplus is declared and distributed as dividends?
View solution
Q. How are dividends typically distributed in the Contribution Method?
View solution
Q. What is the primary focus of Unit Linked Policies in life insurance?
View solution
Q. Which method of surplus distribution is more commonly used in North America?
View solution
Q. In the context of insurance, what does the term "premium" refer to?
View solution
Q. Which of the following factors is not considered in the process of setting the premium for life insurance policies?
View solution
Q. What is the Gross premium in the context of life insurance?
View solution
Q. What does a "lapse" mean in the context of insurance?
View solution
Q. What is the primary reason for the emergence of surplus in the context of life insurance?
View solution
Q. How can surplus be allocated in the life insurance industry?
View solution
Q. What is the most common form of bonus in life insurance?
View solution
Recommended Subjects
Are you eager to expand your knowledge beyond IC38 Life Insurance Agent Exam? We've handpicked a range of related categories that you might find intriguing.
Click on the categories below to discover a wealth of MCQs and enrich your understanding of various subjects. Happy exploring!
