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Question: Maradona (a famous football star) has insurance on his house and belongings inside the house. As a result, he never feels the need to lock the front door. Maradona’s action is called

Options:

  1.  Adverse selection
  2.  Moral hazard
  3.  Morale hazard
  4.  Fortuitous
  5.  None of the above

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2. Moral hazard

Maradona (a famous football star) has insurance on his house and belongings inside the house. As a result, he never feels the need to lock the front door. Maradona’s action is called Moral hazard.

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