General Insurance PrinciplesQuestion 182 of 716
An insured stops locking the car because she knows she has comprehensive auto coverage. This behavior is an example of:
a.A morale hazard
b.A moral hazard
c.A legal hazard
d.A physical hazard
Explanation
A morale (attitudinal) hazard is the carelessness or indifference that arises because a person knows they are insured. A moral hazard, by contrast, involves intentional dishonesty such as planning to file a false claim.
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Related questions on this topic
- Which of the following is an example of a pure risk that an insurer would accept?
- Which mathematical principle allows insurers to predict losses accurately enough to set fair premiums?
- An applicant for life insurance has uncontrolled high blood pressure. This condition is BEST classified as which type of hazard?
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PrepPass team · Verified against California Life & Health Insurance License Exam · How we review
Reviewed by John Zihao Zhang — California-Licensed Life Insurance Agent (CA Dept. of Insurance License #4396095 — verify)