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IAI Actuarial Core Principles · Actuarial Statistics · Purpose and function of data analysis

A life insurer wants to study mortality of its policyholders. It uses its own policy administration records, collected for billing and claims purposes and not designed for a mortality study. How is this data best described?

The data is secondary because it was originally collected for administrative purposes such as billing and claims, not for the mortality study. Primary data would be gathered specifically for the investigation, regardless of who owns the records.

  1. APrimary data, since the insurer owns it
  2. BSecondary data, since it was collected for a different purposeCorrect
  3. CExperimental data, since the insurer controls policy terms
  4. DCross-sectional survey data, since it covers many policyholders
  5. Synthetic data, since it comes from a system

Explanation

Primary data is collected specifically for the study at hand. Administrative records gathered for billing and claims are being reused for another purpose, so they are secondary. Ownership by the user does not make data primary.

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