When an insurance company specifies certain precautions that an insured person must take it is trying to control for moral hazard.

Name: When an insurance company specifies certain precautions that an insured person must take it is trying to control for moral hazard.
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By specifying certain precautions, the insurance company aims to reduce the likelihood that the insured will engage in riskier behavior knowing they are covered, which is a direct strategy to control for moral hazard.

When an Insurance Company Specifies Certain Precautions That an Insured