Ability of market-insurance to distribute risk efficiently

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Reference no: EM13815073

Which of the following limits the ability of markets for insurance to distribute risk efficiently?

I. A person who is sick is more likely to purchase health insurance than one who is healthy.

II. A person who is covered by flood insurance is more likely to build a house on a beachfront that is often flooded.

III. A person with insurance may pay premiums and never collect any money from the insurance company.

A. I only

B. II only

C. I and II only

D. I and III only

E. I, II, and III

Reference no: EM13815073

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