Morale hazards exist because of the presence of insurance.

Name: Morale hazards exist because of the presence of insurance.
Brand: Quizplus
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Quizplus · Accepted Answer

Morale hazard refers to the situation where the presence of insurance leads to the insured person changing their behavior in a way that increases the likelihood of loss. This is because they know that they will not bear the full consequences of the loss since they are insured. Morale hazards exist precisely because of the availability of insurance.

Morale Hazards Exist Because of the Presence of Insurance