CA LIFE EXAM – PSI Questions and
Answers (Top Grade Assured) 2026
Update
A participating company is also referred to as which type of
insurer? - Correct Answers ✅Mutual insurer
An insurer owned by its policyholders, is called a - Correct
Answers ✅Mutual insurer
What is a participating life insurance policy? - Correct
Answers ✅Contract that allows the policyowner to receive a
share of surplus in the form of policy dividends
An insurer enter into a contract with a third-party to ensure
itself against losses from insurance policies it issues. What is
this agreement called? - Correct Answers ✅Reinsurance
John owns an insurance company that gives him the right to
share and then sure surplus. What kind of policy is this? -
Correct Answers ✅Participating
Which of the following is not a characteristic of reinsurance? -
Correct Answers ✅Increases the unearned premium
reserved
Which of the following is not a benefit of insurance? - Correct
Answers ✅Losses due to fraud are eliminated
,CA LIFE EXAM – PSI Questions and
Answers (Top Grade Assured) 2026
Update
When a mutual insurer becomes a stock company, the
process is called - Correct Answers ✅Demutualization
Which of the following is a contract that involves one party
which indemnifies another one a loss arises from an unknown
event? - Correct Answers ✅Insurance policy
Which of the following is an insurer established by a parent
company's loss exposure's? - Correct Answers ✅Captive
insurers
Which of the following is not considered to be a definition for
the term "loss"? - Correct Answers ✅Probability that an
event will occur
Which of the following is not considered a definition of a risk?
- Correct Answers ✅The cause of loss
Which of the following best describes the statement; " the
more times, and event is repeated, the more predictable the
outcome becomes"? - Correct Answers ✅Law of large
numbers
, CA LIFE EXAM – PSI Questions and
Answers (Top Grade Assured) 2026
Update
Which of the following would not be accomplished with the
purchase of an insurance policy? - Correct Answers ✅Risk
is eliminated
Which of the following is a situation where there is a
possibility of either a loss or gain? - Correct Answers
✅Speculative risk
Which of the following is any situation that presents the
possibility of a loss? - Correct Answers ✅Loss
An insurer having a large number of similar exposure units is
considered important because: - Correct Answers ✅the
greater the number insured, the more accurately that is her
can predict losses & set appropriate premiums
Which of these statements correctly describes risks? -
Correct Answers ✅Pure risk is the only insurable risk
Which type of risk is gambling? - Correct Answers
✅Speculative risk
Moral hazard is described as the: - Correct Answers
✅increased chance of a loss because of an insured's
dishonest tendencies
Answers (Top Grade Assured) 2026
Update
A participating company is also referred to as which type of
insurer? - Correct Answers ✅Mutual insurer
An insurer owned by its policyholders, is called a - Correct
Answers ✅Mutual insurer
What is a participating life insurance policy? - Correct
Answers ✅Contract that allows the policyowner to receive a
share of surplus in the form of policy dividends
An insurer enter into a contract with a third-party to ensure
itself against losses from insurance policies it issues. What is
this agreement called? - Correct Answers ✅Reinsurance
John owns an insurance company that gives him the right to
share and then sure surplus. What kind of policy is this? -
Correct Answers ✅Participating
Which of the following is not a characteristic of reinsurance? -
Correct Answers ✅Increases the unearned premium
reserved
Which of the following is not a benefit of insurance? - Correct
Answers ✅Losses due to fraud are eliminated
,CA LIFE EXAM – PSI Questions and
Answers (Top Grade Assured) 2026
Update
When a mutual insurer becomes a stock company, the
process is called - Correct Answers ✅Demutualization
Which of the following is a contract that involves one party
which indemnifies another one a loss arises from an unknown
event? - Correct Answers ✅Insurance policy
Which of the following is an insurer established by a parent
company's loss exposure's? - Correct Answers ✅Captive
insurers
Which of the following is not considered to be a definition for
the term "loss"? - Correct Answers ✅Probability that an
event will occur
Which of the following is not considered a definition of a risk?
- Correct Answers ✅The cause of loss
Which of the following best describes the statement; " the
more times, and event is repeated, the more predictable the
outcome becomes"? - Correct Answers ✅Law of large
numbers
, CA LIFE EXAM – PSI Questions and
Answers (Top Grade Assured) 2026
Update
Which of the following would not be accomplished with the
purchase of an insurance policy? - Correct Answers ✅Risk
is eliminated
Which of the following is a situation where there is a
possibility of either a loss or gain? - Correct Answers
✅Speculative risk
Which of the following is any situation that presents the
possibility of a loss? - Correct Answers ✅Loss
An insurer having a large number of similar exposure units is
considered important because: - Correct Answers ✅the
greater the number insured, the more accurately that is her
can predict losses & set appropriate premiums
Which of these statements correctly describes risks? -
Correct Answers ✅Pure risk is the only insurable risk
Which type of risk is gambling? - Correct Answers
✅Speculative risk
Moral hazard is described as the: - Correct Answers
✅increased chance of a loss because of an insured's
dishonest tendencies
