Moral Hazard in Auto Insurance Might Refer To

question 1

Multiple Choice

Moral hazard in auto insurance might refer to:

• A)an auto owner failing to maintain the car, increasing the likelihood of an accident.
• B)an applicant withholding information from the insurance company about the likelihood of having an accident.
• C)an applicant lying on their application form about their health history.
• D)an applicant having more cars than they announce when they complete their application.

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Definitions:

Schema

A cognitive framework that organizes and interprets information in the brain, influencing perception and understanding.

Storytelling Bias

The tendency to interpret, remember, and predict events in a narrative format, often overlooking statistical or factual information.

Allport and Postman

Psychologists known for their work in the field of social psychology, particularly for studies on the psychology of rumor and the theory of personality.

Participants

Individuals who take part in a study, experiment, or any form of research, usually providing data for analysis.