Craig is a reckless driver.He is careless because his Porsche is insured and he knows that losses incurred will be covered.This is an example of a:

Question

Quizplus · Accepted Answer

Moral hazard occurs when an individual takes excessive risks because they know that the losses will be covered by insurance. In this case, Craig is a reckless driver because he knows that his Porsche is insured and that any losses incurred will be covered.

Craig Is a Reckless Driver