What is a fundamental expectation under the doctrine of utmost good faith in insurance?

The doctrine of utmost good faith, known as "uberrima fides," is a foundational principle in insurance contracts that requires both parties—insurers and insureds—to act honestly and not hide any relevant information. This principle places a strong emphasis on the insured parties' obligation to disclose all material facts when applying for insurance, as any omission or misrepresentation can lead to disputes or denial of claims.

When insured parties are completely honest, it allows insurers to accurately assess the risk associated with providing coverage. Full disclosure of relevant information is crucial for insurers to determine appropriate premiums, terms, and conditions for the insurance contract. This transparency ensures that both parties have a mutual understanding of the risks involved, ultimately fostering trust and fairness in the insurance relationship.

In contrast, the other options don't align with this foundational expectation. Unlimited coverage isn't practical or feasible, dishonesty from applicants undermines the principle of good faith, and accepting omissions in applications would compromise the integrity of the insurance process. Thus, the correct understanding of the doctrine highlights the critical need for honesty from insured parties.