Insurers try to minimize moral hazard by

Question

Quizplus · Accepted Answer

The best way insurers try to minimize moral hazard is by charging deductibles and coinsurance. By requiring the policyholder to pay a portion of the cost for any covered loss, they are less likely to engage in risky behavior or file frivolous claims. This reduces the risk of moral hazard, where the policyholder may behave recklessly, knowing that the insurer will bear the costs of any loss. The other options listed are incorrect or discriminatory practices that are not allowed by law.

Insurers Try to Minimize Moral Hazard by