✅ Mastering Insurance and Data Analysis: Essential 2025 Practice Questions and Answers Examsharks

Are you preparing for your 2025 insurance exams or looking to sharpen your statistics and data analysis skills? 📚 This guide has you covered! We’ve put together a powerful collection of real-world insurance licensing questions, life insurance scenarios, healthcare program basics, data interpretation tasks, and statistics problems. Whether you’re aiming to pass PSI Services LLC exams, understand the basics of annuities, or simply ace your upcoming tests, this resource will help you feel confident and ready. Dive deep into topics like Universal Life policies, coordination of benefits, Medicaid, observational studies, frequency histograms, and much more — all crafted to feel like real exam day experiences. Ready to succeed? Let’s do this together! 🚀 Visit ExamSharks.com for 24/7 expert help!

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A producer license is NOT required when

A. receiving a referral fee.

B. receiving commissions.

soliciting insurance.

D. negotiating insurance.

Under traditional fixed annuity contracts, the party who assumes the investment risk is the

O A. insurer.

B. beneficiary.

O C. contract owner.

O D. annuitant.

Which is NOT one of the standard exclusions found in life insurance policies?

A. War or military service

O B.

Disability

O C. Hazardous occupation or hobbies

O D. Aviation

According to Pennsylvania law, which of the following is a licensee required to provide at the time a cust

O A. summary of the licensee’s business practices

O C.

list of the personal information the licensee will publicly disclose

means of contacting the fair credit reporting agencies

notice that clearly states the licensee’s privacy policies and practices

Who does NOT have an insurable interest in an insured?

A. The insured’s neighbor.

O B. The insured’s mother.

O C. The insured’s daughter.

OD. The insured’s business partner.

A. securing permission from the insurance company.

B. notifying his brother in writing.

C. obtaining his brother’s written consent.

D. surrendering the policy to the creditor.

In which of the following policies is the insured covered to age 100 and the owner pays a level premium thr

O A. Paid–up whole life policy.

B. Single premium whole life policy.

O C. Renewable term policy.

O D. Straight whole life policy.

Each of the following are characteristics of a fixed annuity contract EXCEPT

OA. benefit payments remain level.

O B. funds are invested in a separate account.

O C. the minimum interest rate is guaranteed in the contract.

OD. it may be sold as an immediate or deferred annuity.

Which is an example of naming beneficiaries by class?

A. “To the children born of my union with Neville Jones.”

O B. “To the child born of my union with Neville Jones: Frank Jones.”

C. “To the children born of my union with Neville Jones: Frank Jones, Andrew Jones, and Rosemary

O D. “To Neville Jones.”

JOLAIREY

For licensing purposes, the producer’s principal place of business or residence in any state determines th

O A. insurance transaction site.

O B. home state.

O C.

territory.

O D. license renewal date.

A survivorship life policy pays the insured amount upon the death of the

O A. last insured who dies.

OB. first contingent insured who dies.

O C. last contingent insured who dies.

D. first insured who dies.

Which of the following provides life insurance protection for a specified period of time?

O A. universal life insurance

B. whole life insurance

O C. variable life insurance

OD. term life insurance

Which of the following best describes how insurers predict the chance of loss?

O A. the law of large numbers

O B. average disability occurrences

O C. current census table

OD. insurable interest

Pennsylvania continuing education requirements apply to insurance producers who are:

A. Serving full time in the armed forces during the calendar year

O B. Qualified and licensed to sell major lines of insurance

O C. Licensed attorneys with proof of continuing legal education

D. Nonresidents complying with their own state continuing education requirements

Which is an accurate statement regarding the taxation of personal life insurance?

A. The payment of accelerated death benefits are reported as taxable income.

OB. Dividends and interest earned are taxable as ordinary income.

C. The interest on a policy loan is tax deductible to the insured.

C D. Lump sum death benefits are income tax free.

Under a waiver of premium rider, the company waives the right to receive a premium if the insured individ

O A. mentally but not physically disabled.

B. disabled for less than 6 months.

disabled but chooses not to register as a disabled individual.

D. permanently and completely disabled.

A. jail term not to exceed 6 months.

penalty of up to $1,000 for each violation.

O C.

penalty of up to $5,000 for each violation.

O D. penalty of not less than $100 but not more than $500 for each violation.

The Insurance Commissioner is NOT responsible for

administering insurance laws.

B. approving insurance rates.

C. endorsing insurers.

D. reviewing policy forms.

Which of the following represents a reduced paid–up nonforfeiture option?

OA. The policy will have a decreased face amount.

B. A full share of expense loading must be included in the premium on the reduced coverage.

C. Further premiums must be paid on the reduced policy.

D. The new face amount is the same as the original policy.

EXCEPT for fraud, what is the time limit after issue for an insurer to deny an individual health insurance clai application for the insurance?

O A. 180 days

O B. 1 year

C. 5 years

O D. 3 years

Under a Universal Life insurance policy, a corridor represents the

OA. time allotted to the insured to convert a group policy to an individual policy.

B. gap between the total death benefit and the policy’s cash value.

C. percentage of benefits paid to each of the policy’s beneficiaries.

D. stipulated time period that a policy may be reinstated after it has lapsed.

In Pennsylvania, a provision that protects a policyowner from a misrepresentation caused by an innocent

A. an elimination provision.

B. an incontestability provision.

a nonforfeiture provision.

D. a negligence provision.

A company wants to offer a retirement plan to its employees. The plan will NOT qualify for favorable tax tre

OA. has a defined vesting schedule.

O B. exists for the sole benefit of employees and beneficiaries.

O C. applies contributions without regard to income.

OD. is temporary.

A producer’s underwriting duties include which of the following?

O A. completing applications and collecting initial premiums

B. setting premium amounts

C. declining or accepting an application

D. issuing the policy

If a policyowner surrenders a policy for its cash value, when is a tax liability incurred?

OA. The cash value is less than premiums paid.

B. The cash value exceeds all premiums paid.

OC. At the original maturity date of the policy.

OD. The cash value equals the premiums paid.

An individual who is NOT acceptable by an insurer at standard rates because of health, habits, or occupati

O A. standard risk.

B. rating risk.

O C.

substandard risk.

O D. preferred risk.

O A. Key person insurance

O B. A deferred compensation plan

C. A business continuation plan

O D.

Executive bonus insurance

The dividend option where the insurer issues the policyowner a check for the dividend amount is called a

A. cash dividend option.

B. paid–up option.

C. reduced premium dividend option.

D. one–year dividend option.

What type of insurer is owned by policyowners?

O A. Alien

O B. Foreign

O C. Stock

O D. Mutual

What is the focus of major medical insurance?

O A. Reducing costs by using in–network facilities.

O B. Providing preventive care.

O C. Providing care to low income families.

O D. Providing coverage for hospitalization expenses.

An incomplete application submitted to an insurer is

O A. automatically rated by the underwriter.

declined after 30 days if no response for completion is received.

O C. returned to the submitting producer for completion.

OD. automatically declined by the insurer.

When an insurer offers a policy that is nonparticipating, the insurer’s policy

A. enables policyowners to receive a refund of premium overcharges.

B. does not pay dividends.

C. provides significant tax advantages.

D. enables policyowners to participate in company profits.

What is the purpose of a grace period in life insurance policies?

O A. To reinstate the policy after it has been surrendered

B. To guarantee the insured’s right for a premium refund

C. To allow the insurer to waive the premium

D. To prevent unintentional policy lapse

With a deferred annuity, how soon can the benefit payments begin?

O A. Within 12 months of date of purchase

O B. At least 6 months after date of purchase

O C. At least 12 months after date of purchase

D. Within 6 months of date of purchase

A withdrawal from a qualified plan will incur a 10% tax penalty if it is made

O A. to a former spouse as a result of a divorce decree.

B. for the purchase of a first home.

O C. due to a disability of the participant.

O D. before the insured reaches age 59 1/2.

The purpose of a coordination of benefits provision is to

A. determine the amount of the claim.

B. avoid claims overpayment.

O C. allow participants to choose benefits.

O D. duplicate benefits of two plans.

The clause in a life insurance policy protecting its proceeds from the beneficiary’s creditors is referred to

O A. lien exclusion clause.

O B.

creditor life clause.

O C. credit shelter trust clause.

O D. spendthrift trust clause.

For a contract to be valid, it MUST be for a legal purpose and involve an exchange of

O A. consideration.

OB. written documentation.

O C. an implied warranty.

D. an offer.

A point of service (POS) plan is an example of

O A. an exclusive provider organization.

O B. a preferred provider organization.

O C. a preventive care provider.

O D. a managed care plan.

Which of the following is a health care program for low income persons?

O A. Medicaid.

O B. Medicare.

O C. Aid for Families with Dependent Children.

O D.

Medigap.

The provision of an accident and health policy which requires an insurer to pay benefits immediately upon submitted by an insured is

O A. timely payment of claim.

O B.

reinstatement claim.

O C. notice of claim.

O D. grace period.

A Pennsylvania long–term care policy must offer an inflation protection feature that increases benefit level

OA. 8%

O B. 10%

O C. 5%

O D. 2%

A Pennsylvania producer received a new telephone number on April 1. The producer must inform the Insur no later than

O A. May 1.

O B. the next license renewal date.

O C. July 1.

O D. April 15.

Nancy purchased a life insurance policy with a face amount of $250,000. Over a period of years, the cash face amount of the policy has become $300,000. This is an example of a

A. modified premium whole life policy.

O B.

B. participating whole life policy.

O C.

C. limited pay life insurance policy.

O D. universal life policy.

The Insurance Commissioner can take an administrative action for any of the following, EXCEPT

O A. conviction of a misdemeanor offense for driving under the influence.

failure to pay state income tax.

O C. misrepresentation of the terms of an insurance contract.

D. willful violation of an order of the commissioner.

OLEN

Which of the following circumstances may be grounds for suspending an insurance license?

O A. failure to follow insurer’s underwriting rules

O B. conviction of a felony

O C.

failure to maintain records for 5 years

D. conviction of a summary offense

It is the responsibility of the producer to report a change of all the following information to the Pennsylvani

O A. telephone number.

street address.

C. website page.

O D. email address.

PRACTICE TEST

Which of the following is the capital of the United States?

Washington, DC

O B. New York, NY

O C.

Chicago, IL

O D. Los Angeles, CA

randomized block design

completely randomized design

single–blind design

matched–pairs design

The following pie chart displays the position played by the most valuable player (MVP) in the National League of Major League Baseball from 1931 through 2018 misleading. What should be done to improve the graphic?

National League MVP [1931-2018]

11%

18 17%

11%

37%

Explain how the graphic is misleading. Choose the correct answer below.

Time Remai

(f) Describe the shape of the distribution. Choose the correct answer below.

Skewed right

Bell-shaped

Skewed left

Uniform

An experiment was conducted in which two fair dice were thrown 100 times. The sum of the pips showing on the dice was then recorded. The frequency histogram to the right gives the results. Use the histogram to complete parts (a) through (f).

(a) What was the most frequent outcome of the experiment?

(b) What was the least frequent?

(d) How many more 4’s were observed than 11’s?

(e) Determine the percentage of time a 9 was observed.

www

Frequency

20-

Determine whether the quantitative variable is discrete or continuous.

The number of violent crimes committed in a city on a given day in a random sample of 130 days

discrete

continuous

Determine whether the underlined numerical value is a parameter or a statistic. Explain your reasoning.

A poll of all 2000 students in a high school found that 94% of its students owned cell phones.

Choose the correct answer below.

A. Statistic, because the data set of all 2000 students in a high school is a population.

B. Statistic, because the data set of a sample of students is a sample.

C. Parameter, because the data set of all 2000 students in a high school is a sample.

D. Statistic, because the data set of all 2000 students in a high school is a sample.

E. Parameter, because the data set of all 2000 students in a high school is a population.

OF. Statistic, because the data set of a sample of students is a population.

G. Parameter, because the data set of a sample of students is a population.

H. Parameter, because the data set of a sample of students is a sample.

A television station asks its viewers to call in their opinion regarding the variety of sports programming.

What type of sampling is used?

A. Stratified

B. Convenience

C. Systematic

OD. Cluster

OE. Simple random

The following survey has bias.

(a) Determine the type of bias.

(b) Suggest a remedy.

A health teacher wishes to do research on the weight of college students. She obtains the weights for all the students in her 9 A.M. class by looking at their dri

(a) What is the type of bias?

Nonresponse bias

Sampling bias

Response bias

(b) What is a possible remedy?

Conduct face–to-face or telephone interviews.

Reword the question.

Use systematic random sampling.

affects the other variable.

is the variable of interest.

is the variable of interest.

affects the other variable.

the number of individuals who participated in the study.

age.

whether or not lung cancer was contracted,

level of trauma,

gender,

UCLAUSG T

gender,

whether or not lung cancer was contracted,

level of trauma,

age,

the number of individuals who participated in the study.

at a specific point in time.

over a very short period of time.

on:

by asking them to look back in time.

cross–sectional study.

based on existing records.

case–control study,

by observing them over a long period of time.

cohort study,

is p

(a) What type of observational study was this? Explain.

This was a

because information was collected about a group of individuals

(b) What is the response variable? What is the explanatory variable?

The response variable is

because it

The explanatory variable is

(c) In the report, the researchers stated that “the research team also hasn’t ruled out that a common factor like genetics could be causing both the emotions and th sentence means. Choose the correct answer below.

A. It is not important to adjust for explanatory variables.

B. The researchers may be concerned with confounding that occurs when the effects of two or more explanatory variables are not separated or when there a

that were not considered in a study, but that affect the value of the response variable.

C. The researchers thought that genetics had greater influence than level of trauma.

(1) A local news broadcast reported that 13.4% of tickets purchased from the airline are for flights to San Diego. What is wrong with this statement?

OA. There is nothing wrong with the statement.

B. No level of confidence is provided along with the estimate.

C. The percentage is incorrect.

Time Remaining: 00:47:16

Next

BELLD

(d) Construct a relative frequency bar graph. Choose the correct answer below.

OA.

Relative Freq

0.2

LONCS

Relative Freq.

LONCS

0.2

LONCS

(e) Construct a pie chart. Choose the correct answer below.

OA.

LONGS

OB.

LONGS

LONGS

An airline offers discounted flights from Atlanta to five American cities. Below is a frequency distribution of the number of tickets purchased for each location based on a random sample of purchased tickets. Complete parts (a) through (f).

(a) Construct a relative frequency distribution of the d

Response

Relative Frequency

Response

Frequency

Las Vegas

1185

Orlando

959

New York

1471

Chicago

728

San Diego

672

Las Vegas

Orlando

New York

Chicago

San Diego

(Round to three decimal places as needed.)

(b) What proportion of the tickets were for New York?

(Round to three decimal places as needed.)

OA.

Frequency

1600

1200

800

400

LONCS

Frequency

1600

12001

800 400

O c.

Frequency

OLONCS

1600

12001

800

400

LONCS

Use the given minimum and maximum data entries, and the number of classes, to find the class width, the lower class limits, and the upper class limits.

minimum = 14, maximum = 132, 8 classes

The class width is

(Type a whole number.)

Choose the correct lower class limits below.

A. 14, 29, 44, 59, 74, 89, 104, 119

B. 14, 28, 44, 58, 73, 89, 103, 119

C. 29, 43, 59, 74, 89, 103, 118, 133

D. 28, 43, 59, 73, 88, 103, 119, 133

Choose the correct upper class limits below.

A. 28, 43, 59, 74, 88, 103, 118, 133

B. 29, 44, 59, 74, 89, 103, 119, 133

C. 28, 43, 58, 73, 88, 103, 118, 133

D. 29, 44, 58, 73, 89, 103, 119, 133

✅ Mastering Insurance and Data Analysis: Essential 2025 Practice Questions and Answers

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