Experts find ways to eliminate moral hazard in insurance markets.
The article explores why people might not try as hard to save money if they won't face the consequences. It looks at different experiments to see when this "moral hazard" happens and how to fix it. The results show that experts don't change their behavior based on customers' insurance. Competition helps reduce moral hazard, especially in markets with low chances of damage. Also, group schemes and peer pressure can make people act more responsibly.