Which term describes a hazard created by a dishonest individual willing to cause a loss to collect insurance?

The term that describes a hazard created by a dishonest individual who is willing to cause a loss to collect insurance is "Moral Hazard." This concept refers to the risk that an insured party may engage in dishonest or fraudulent behavior, as they may perceive that they have less to lose due to their insurance coverage. Moral hazard occurs when individuals take risks they would not normally take because they know they are insured against those risks.

In the context of insurance, a person with moral hazard may intentionally create a situation that leads to a loss, knowing they will be compensated for that loss through their insurance policy. This behavior can significantly increase the risk for insurers, as it can lead to fraudulent claims and economic losses.

The other terms listed do not reflect this specific concept. Negligence pertains to a failure to take proper care in doing something, which can lead to unintended loss but does not involve intentional wrongdoing. Mortgagee Rights refer to the rights held by the lender of a mortgage in relation to the property, and Named Peril Policies outline specific risks that are covered under an insurance policy but do not define a type of hazard associated with dishonest behavior.