Which of the following is not true about moral hazard?

Question

Quizplus · Accepted Answer

Moral hazard is the tendency of people to change their behavior when they are insured as they have less incentive to avoid risky behavior. This can lead to higher risks and more claims, which can increase premiums for everyone. However, moral hazard does not lead to people with higher risks buying more insurance. In fact, people with higher risks are more likely to be denied insurance or offered higher premiums due to adverse selection.

Which of the Following Is Not True About Moral Hazard