The tendency for insurance to be purchased only by those who are most likely to need it, thus raising its cost and reducing its benefits.

Refers to a situation in which sellers have relevant information that buyers lack (or vice versa) about some aspect of product quality.

This is an economic term to describe what happens when a person makes a decision that will have adverse results. In health insurance, it describes what happens when a person makes a decision based on his/her diminished health condition or frequency of needed treatment and is, therefore considered a poorer claims risk than most others in the group.

The tendency of those who experience greater health risks to apply for and continue their coverage under any given health insurance plan. When adverse selection increases, health insurance companies e [..]

An imbalance in an exposure group created when persons who perceive a high probability of loss for themselves seek to buy insurance to a much greater degree than those who perceive a low probability [..]

When a negotiation between two people with different amounts of information, that is, asymmetric information, restricts the quality of the good traded. This typically happens because the person with m [..]

The tendency of persons with poorer-than-average health expectations (higher risk) to apply for or continue insurance coverage to a greater extent than persons with average or better-than-average heal [..]

Definition When an individual who is a higher-than-average risk tries to buy insurance at the standard rate.

Occurs when an employee or group of employees purchase or select coverage with a greater than likely loss at the expense of an insurance company (or the organization if it is self-insured). This is al [..]

An unequal or inefficient exchange on the market caused by differences in information (or information asymmetry) between the two parties. For example, a used-car salesman has better information on the [..]

The process by which an insurer is left with a disproportionate share of unwanted, higher-risk business. Particularly common in the life and health lines, adverse selection can occur when higher-than-expected claims experience leads an insurer to raise rates, which in turn causes the migration of "good" risks to companies charging less. A [..]

the social phenomenon whereby persons with a higher than average probability of loss seek greater insurance coverage than those with less risk.

The phenomenon of the enrollment of a disproportionate percentage of persons who are poorer risks—

State of affairs wherein a negative signal is given by market participation.

The tendency of insurance to be purchased by those most likely to make claims.

refers to an insurance company's coverage of life insurance applicants whose risk as policyholders, due to their way of life, is significantly higher than the company perceives.

Adverse selection refers to a situation where there is an imbalance of information which results in a situation where those on the informed side of the market self-select in a way that harms the uninf [..]

 The tendency of those exposed to a higher risk to seek more insurance coverage than those at a lower risk.

principle that says that those who most want to buy insurance tend to be those most at risk, but charging a high price for insurance (to cover the high risk)will discourage those at less risk from buy [..]

The tendency of those exposed to a higher risk to seek more insurance coverage than those at a lower risk. Insurers react either by charging higher premiums or not insuring at all, as in the case of f [..]

The tendency of persons who present a poorer-than-average risk, to apply for, or continue, insurance to a greater extent than do persons with average or better-than-average expectations of loss. An in [..]

a statistical condition within a group when there is a greater demand for dental services and/or more services necessary than the average expected for that group.

The tendency of persons with poorer-than-average health expectations (higher risk) to apply for or continue insurance coverage to a greater extent than persons with average or better-than-average health expectations (lesser risk).

The tendency of people who are poor insurance risk to purchase and maintain insurance coverage.Insurers usually try to reduce their risk in insuring a bad risk by having rigid underwriting guidelines.

The tendency of those exposed to a higher risk to seek more insurance coverage than those at a lower risk. Insurers react either by charging higher premiums or not insuring at all, as in the case of f [..]

The tendency of poorer than average risks to buy and maintain insurance. Adverse selection occurs when insureds select only those coverages that are most likely to have losses.

The tendency of persons who present a poorer-than-average risk to apply for, or continue, insurance to a greater extent than do persons with average or better-than-average expectations of loss.

Consider a market in which products of varying quality are exchanged. Both buyers and sellers rank products of different quality in the same way, but ...

A market exhibits adverse selection when the inability of buyers to distinguish among products of different quality results in a bias towards the supply ...

The tendency for poorer risks (or less desirable insureds) to seek insurance, or to continue insurance, or to select options of settlement that are favorable to them, to a greater extent than do good [..]

A measure of the average value of benefits in a health insurance plan. It is calculated as the percentage of benefit costs a health insurance plan expects to pay for a standard population, using standard assumptions and taking into account cost-sharing provisions. Placing an average value on health plan benefits allows different health plans to be [..]

The problem of attracting members who are sicker than the general population, specifically, members who are sicker than was anticipated when developing the budget for medical costs. A tendency for utilization of health services in a population group to be higher than average or the tendency for a person who is in poor health to be enrolled in a hea [..]

When a negotiation between two people with different amounts of information, that is, asymmetric information, restricts the quality of the good traded. This typically happens because the person with m [..]

principle that says that those who most want to buy insurance tend to be those most at risk, but charging a high price for insurance (to cover the high risk)will discourage those at less risk from buy [..]

The tendency of those exposed to a higher risk to seek more insurance coverage than those at a lower risk. Insurers react either by charging higher premiums or not insuring at all, as in the case of f [..]

The tendency of risks with higher probability of loss to purchase and maintain insurance more often than the risks who present lower probability.

(economics,business|insurance) The process by which the price and quantity of goods or services in a given market is altered due to one party having information that the other party cannot have at r [..]

means that, at the time a contract is signed or a transaction takes place, some agents have private information.

Refers to a situation in which sellers have relevant information that buyers lack (or vice versa) about some aspect of product quality.