Ted Purchased a Comprehensive Insurance Policy for His Car

question 61

Multiple Choice

Ted purchased a comprehensive insurance policy for his car. Which of the following is an example of moral hazard?

• A) Because of his insurance coverage, Ted avoids driving when the roads are icy.
• B) Because of his insurance coverage, Ted no longer locks his car doors.
• C) Because of his insurance coverage, Ted uses a designated driver for the nights he spends bar hopping.
• D) Because of his insurance coverage, Ted replaced his worn-out tires with Michelin tires.

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Definitions:

Detrimental Effects

Negative impacts or consequences that harm or hinder something or someone.

Aerobic Activity

Physical exercise that improves the efficiency of the body's cardiovascular system in absorbing and transporting oxygen.

Relaxation Response

A physiological state of deep rest that can be elicited through various practices such as meditation or deep breathing, counteracting stress effects.

Religion-based Techniques

Strategies or practices grounded in religious beliefs used to solve problems, improve well-being, or achieve spiritual goals.