CFA Practice Question

There are 275 practice questions for this study session.

CFA Practice Question

When people are less careful about avoiding insured losses than they would be if they were not insured, so that losses occur more often than they would otherwise, ______ occurs.
A. insurance fraud
B. moral hazard
C. adverse selection
Explanation: There are three major problems insurance companies try to control: fraud, moral hazard, and adverse selection. Moral hazard refers to the increased loss due to increased risk due to carelessness or indifference.

User Contributed Comments 0

You need to log in first to add your comment.