>[!abstract] >In economics, a moral hazard is a situation where an economic actor has an incentive to increase its exposure to risk because it does not bear the full costs of that risk. For example, when a corporation is insured, it may take on higher risk knowing that its insurance will pay the associated costs. A moral hazard may occur where the actions of the risk-taking party change to the detriment of the cost-bearing party after a financial transaction has taken place. ("Moral Hazard", 2025). ## References - Moral hazard. (2025, January 2). In *Wikipedia*. https://en.wikipedia.org/w/index.php?title=Moral_hazard&oldid=1252156670