Which of the Following Practices Mitigates Moral Hazard

question 89

Multiple Choice

Which of the following practices mitigates moral hazard?
I. A health insurance company's policy requires a $500 deductible and a 20% coinsurance rate.
II. Progressive Insurance offers drivers a discount for using a black box that records miles driven and the number of sudden stops.
III. Homeowner insurance does not cover claims arising from backyard swimming pools.

• A) I
• B) I, II, and III
• C) III
• D) II and III

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Definitions:

Homebound

A term describing individuals who are unable to leave their home due to physical or psychological conditions without considerable and taxing effort.

Auditory Nerve

The nerve that carries signals from the inner ear to the brain, enabling hearing.

Cardiotonic

A type of medication or substance that increases the strength and efficiency of the heart muscle, improving its contraction.

Analgesic

A type of medication used to relieve pain without causing unconsciousness, ranging from over-the-counter aspirin to prescription drugs.