How To Avoid Getting Whacked By The Doctrine Of Reasonable Expectations

Introduction

Since Professor (later Judge) Robert Keeton first put a name to the reasonable expectations doctrine in 1970, it has generally been regarded as strongly pro-policyholder—a counterbalance to the adhesive nature of insurance contracts and the negotiating advantage insurers typically have over insureds. While forms of the doctrine widely persist, Keeton's formulation, under which an insured's reasonable expectations of coverage may trump unambiguous policy language negating coverage, has little continued support. What remains is often little more than a convenient justification for whatever result a court is inclined to favor. Moreover, contrary to the doctrine's underlying rationale, courts have increasingly invoked the doctrine in favor of insurers, in some instances negating coverage even where strict adherence to the policy language, or at least straightforward application of the rule