What doctrine is violated if a company issues an auto collision coverage contract that excludes collisions?

The doctrine of reasonable expectations is based on the premise that policyholders are entitled to expect their insurance coverage to be consistent with their understanding of the policy’s terms. When an auto collision coverage contract explicitly excludes collisions, it contradicts what a typical policyholder would reasonably expect from a policy labeled as "collision coverage."

Policyholders generally assume that purchasing collision coverage would protect them against damages resulting from collisions, as the name suggests. If a contract includes such a significant exclusion that fundamentally alters the purpose of the coverage, it violates the doctrine of reasonable expectations. This doctrine aims to protect consumers against misleading policy language and ensures that the actual coverage matches what a reasonable person would take from the policy.