One purpose of exclusions in the HO policy is to eliminate losses due to moral hazard.

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Exclusions on the HO policy are designed to eliminate losses that could potentially arise from moral hazard, which refers to the tendency of individuals to behave in a riskier manner when they are protected by insurance. Some common exclusions in the HO policy include losses resulting from intentional acts, criminal activity, or gross negligence, which are all examples of behaviors that could be influenced by the presence of insurance coverage. By excluding these types of losses, insurance companies can help mitigate the effects of moral hazard and maintain their financial stability over the long term.

One Purpose of Exclusions in the HO Policy Is to Eliminate