adverse selection

noun

, Insurance.

1. the process of singling out potential customers who are considered higher risks than the average.

Example Sentences

"If your car doesn't work, you're just stuck. It's just mean, don't you think?" said Howard Drake, a GM dealership owner based in California, describing the difficult situation for customers needing repairs."I thought the punishment would be in the form of adverse selection for customers with limited choice. I didn't think it would be my lot stacked up with cars that I can't fix because they won't man a parts distribution center," he said.

From Reuters

Making the program optional would in effect repeal the program by leading to a phenomenon called “adverse selection,” according to Ben Veghte, the director of the WA Cares Fund.

From Seattle Times

While Piskorski’s research suggests that iBuying is potentially profitable, this will be true only if companies can manage this adverse selection problem.

From Washington Post

Zillow may simply have realized before anyone else that adverse selection is intractable.

From Washington Post

This phenomenon, also known as adverse selection, could collapse the market.

From New York Times