Which of the following would be LEAST likely to contribute to a moral hazard problem among drivers?
A) Provide medical coverage to all drivers, their passengers, and any and all individuals involved in the accident, no matter who was at fault.
B) Provide medical coverage and car repair/replacement coverage to drivers, their passengers, and any and all individuals involved in the accident, no matter who was at fault.
C) Modify all cars to remove the driver's seatbelt and the steering wheel air bag.
D) Pass a law limiting the amount of damages that juries may award in accident cases.
E) Make automobile insurance mandatory for all drivers.

Question

Quizplus · Accepted Answer

Removing safety features such as seatbelts and airbags would likely discourage reckless driving and reduce moral hazard, as drivers would face greater risk and consequences in the event of an accident. A, B, D, and E could all potentially contribute to moral hazard by reducing the personal cost and responsibility of reckless driving or accidents.

Which of the Following Would Be LEAST Likely to Contribute