Adverse Selection in Group Health Insurance

Adverse selection has plagued the insurance industry for a long time now. Insurers have found it challenging to find ways to abstain from issuing policies risky for them. A moral hazard and other factors meant that individuals have found ways to benefit from group health insurance by adverse selection. So, what is adverse selection? And why does it matter? This article has the answers. What Is Adverse Selection? Adverse selection refers to a buyer (insured) having more information than the seller (insurer) and using the same to their benefit unscrupulously…

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