No, I'm afraid you don't got it. Try reading the entire essay, perhaps, and not just the snippet? Even just the snippet I quoted is contrary in meaning to the phrasing you just used. Here's a bit more from the linked essay, going into one variant of the concept, active now:
"Insurance: If you have no car insurance, you drive very, very, very carefully. The Moral Hazard describes when a person, upon getting insurance, drives “worse” (read: less slowly, rolling stops; doesn’t avoid talking on cell phone.) NB: he is not driving badly; he is actually driving normally. But he's driving worse than "very carefully." The term “worse” is relative to other behavior. The point is that his behavior has comparatively worsened because he doesn’t have to worry as much about the consequences."
> No, I'm afraid you don't got it. Try reading the entire essay, perhaps, and not just the snippet? Even just the snippet I quoted is contrary in meaning to the phrasing you just used.
You're rather missing the point. As you say, the phenomenon described in the essay is more specific than "a hazard limited only by someone's morals". That means the phrase "moral hazard" is too vague to describe said phenomenon.
"Insurance: If you have no car insurance, you drive very, very, very carefully. The Moral Hazard describes when a person, upon getting insurance, drives “worse” (read: less slowly, rolling stops; doesn’t avoid talking on cell phone.) NB: he is not driving badly; he is actually driving normally. But he's driving worse than "very carefully." The term “worse” is relative to other behavior. The point is that his behavior has comparatively worsened because he doesn’t have to worry as much about the consequences."