Explaining moral hazard.

Filing this under “Things I wish I had written”. A LOL post from Barry Ritholtz at The Big Picture:
Explaining “Moral Hazard” to Salespeople
http://www.ritholtz.com/blog/2011/03/explaining-moral-hazard/

Insurance is something I almost never buy, but the replacement price of the iPhone, combined with the number of cracked screens I have already seen made it imperative.

The missus found a case the exact same shade as her purple Moto-Razor. I didn’t see anything I liked, and knew I would find something fun online. When one of the sales people told me I should really get a case, I tossed the phone up and caught it, then (half-jokingly) said: “I don’t need a case, I have insurance.”

She was absolutely aghast.

I smiled and said to her: “Now you understand Moral hazard.”

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