Proceedings of 7th Annual American Business Research Conference
23 - 24 July 2015, Sheraton LaGuardia East Hotel, New York, USA , ISBN: 978-1-922069-79-5
Abdullah H. Alshery
Insurance is becoming increasingly important for everyone. When a consumer buys an insurance policy from an insurance company, there are usually large disparities in power and legal expertise between the two parties to the contract. In the United States, the doctrine of reasonable expectations has been developed over several decades to provide a basis that courts can use when addressing subsequent disagreements between the consumer and the insurance company over interpretation of the policy.
This paper starts by reviewing the development of the doctrine of reasonable expectations: the need for it, what it is intended to do and not to do, its relationship to other contract principles, and the course of implementation leading to the current usage in the United States.
Then the paper considers whether there is a similar need in the legal system of Saudi Arabia and
Islamic law, determine how well the doctrine of reasonable expectations would mesh with the fundamental tenets of the Saudi legal system, and discuss the factors that would be involved in adapting the doctrine of reasonable expectations for use in Saudi Arabia. The conclusion is that the doctrine of reasonable expectations would be a useful and productive addition to the next revision of the Saudi Arabian legal system.