Moral Hazard and Selection Drive Disparities in Disability Insurance Coverage
The study looked at how people's behavior changes when they have private long-term disability insurance. They used data from both group and individual insurance to see if there was a connection between risk and coverage. The results showed that people with individual insurance tend to take more risks and choose better coverage, which can lead to higher costs for insurers. This means there is a need for policies and strategies to address this issue in disability insurance.