A trait, conduct, or behavior which can cause loss to occur is called a?

A trait, conduct, or behavior which can cause loss to occur is called a?

• A. Hazard
• B. Physical Hazard
• C. Moral Hazard
• D. Morale Hazard

Answer: (C)

Hazards are factors that increase the chance of a loss. The description “trait, conduct, or behavior” points to how a person’s actions can influence risk, which is moral hazard. This contrasts with physical hazard, which is a tangible condition like slippery floors, and morale hazard, which is a careless attitude that stems from having insurance (such as leaving a car unlocked because it’s insured). While hazard is the broad term for anything that raises risk, the emphasis on conduct and character here specifically identifies moral hazard as the responsible concept.

Hazards are factors that increase the chance of a loss. The description “trait, conduct, or behavior” points to how a person’s actions can influence risk, which is moral hazard. This contrasts with physical hazard, which is a tangible condition like slippery floors, and morale hazard, which is a careless attitude that stems from having insurance (such as leaving a car unlocked because it’s insured). While hazard is the broad term for anything that raises risk, the emphasis on conduct and character here specifically identifies moral hazard as the responsible concept.