An applicant conceals relevant health information on the application. The applicant presents what type of hazard?

The correct choice pertains to the concept of moral hazard, which arises when an individual's behavior changes in a way that increases the risk of loss or damages due to their actions. In this scenario, the applicant concealing relevant health information demonstrates a moral hazard because it reflects a deliberate decision to withhold important details that could affect the insurer's assessment of risk.

This type of behavior suggests a lack of integrity or ethical standards in the application process, where the applicant is potentially trying to benefit by hiding information that could lead to a higher insurance premium or even denial of coverage. The expectation is that applicants will fully disclose their health history to allow insurers to accurately evaluate risk and determine appropriate rates.

In contrast, morale hazard typically involves a more negligent attitude toward risk, such as a carelessness that arises from having insurance, whereas physical hazard refers to tangible factors that increase risk, like a dangerous activity or environmental conditions. Legal hazard relates to the potential for liability due to legal or regulatory issues. Understanding these distinctions helps clarify why the act of concealing health information is classified as a moral hazard.