Health insurance markets have a problem with insuring people who are "poor health risks" while many people who are "good health risks" do not buy insurance.This problem is an example of

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Adverse selection occurs when a market is dominated by buyers who are more likely to make claims (in this case, people who are poor health risks) while people who are good health risks are less likely to purchase insurance. This creates an imbalance in the risk pool and can lead to higher premiums and reduced coverage options, which can further deter healthy individuals from purchasing insurance. Moral hazard refers to the idea that having insurance can encourage people to take risks they otherwise would not take, while market signaling and asymmetric information are related but different concepts that do not apply to this situation.

Health Insurance Markets Have a Problem with Insuring People Who