People having a bad driving record find it difficult to buy

People having a bad driving record find it difficult to buy automobile insurance because insurance companies fear that _____________ may happen if they raise the premiums

Solution

The correct answer that will be most suitable for the above blank is \"ADVERSE SELECTION\"

Since if they increase the premiums then the number of people registering with that insurance company will decrease at an rapid rate, hence increasing the premium will adversely effect the selection for the different premium policies available in the market