noun
Moral hazard is a term used in economics and finance to describe the risk that one party may act in a way that is not in the best interest of another party because the first party does not bear the full consequences of their actions.
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The presence of moral hazard in the insurance industry can lead to increased fraudulent claims.
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When people know they're protected by insurance, they might take more risks - that's moral hazard.
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If you're always bailing out your friend, you're just enabling their moral hazard.
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Ignoring the warning signs of moral hazard is like playing with fire in a dry forest.