The Cost of Group Health Insurance Is Lower Than If

question 151

Multiple Choice

The cost of group health insurance is lower than if an individual buys a policy on his own because

• A)the problem of adverse selection is reduced.
• B)moral hazard costs of a group tend to move to a low average.
• C)it is easier for the company to deny claims from a large group.
• D)insuring a group eliminates the problem of buyers having more information than the seller.

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Definitions:

Channel

A medium through which information, entertainment, or communication is transmitted or distributed.

Medium

A means or mode of communication or expression; can refer to materials used in art, types of publication, or channels of communication.

Overall Length

The total length or size of an object, item, or entity from one end to the other.

Level of Detail

The degree of specificity and granularity in a description, presentation, or instruction, affecting how comprehensively a subject is explained or understood.