Michigan Property & Casualty Practice Exam 2025 – Complete Test Prep

The reasonable expectations doctrine aims to protect the insured's reasonable expectations when entering into an insurance contract. This doctrine acknowledges that policyholders may not fully understand the complex language often found in insurance policies. As a result, it is designed to ensure that insurance contracts are interpreted in a way that aligns with what the average insured would reasonably expect those terms to mean.

This principle recognizes that many policyholders might assume certain coverages are included based on representations made by agents, promotional materials, or the nature of the insurance product itself, even when those assumptions are not explicitly detailed in the fine print of the policy. The goal is to avoid situations where an insurer might deny a claim simply because the insured did not fully comprehend the nuances of the contract language. By supporting the notion that the policy should fulfill the reasonable expectations of the insured, the doctrine promotes fairness and transparency in the insurance process.