Question

When joe didn't have car insurance, he drove very cautiously, because he knew he would have to pay for any damage to his car. now that he has car insurance, he tends to speed more, because he knows that even if he gets into an accident, his insurance will cover it?

Answer 1

This is an example of a moral hazard, which is when someone is more likely to engage in dangerous behavior when they perceive that they are protected from the consequences.