Aleatory An insurance contract is considered to be ‘aleatory,’ or dependent on chance or an uncertain outcome, where one party may receive more value than the other party based on uncertain future circumstances. As an example, in life insurance, if a policy is purchased for two million dollars and the insured accidentally dies after just one year of premium payments, the insurer must pay Definition. Aleatory Contract — an agreement concerned with an uncertain event that provides for unequal transfer of value between the parties. Insurance policies are aleatory contracts because an insured can pay premiums for many years without sustaining a covered loss. In insurance, an aleatory contract refers to an insurance arrangement in which the payouts to the insured are unbalanced. Aleatory Contract A mutual agreement between two parties in which the performance of the contractual obligations of one or both parties depends upon a fortuitous event. The most common type of aleatory contract is an insurance policy in which an insured pays a premium in exchange for an insurance company's promise to pay damages up to the face amount of the policy in the event that one's house is destroyed by fire. Because most insurance contracts are aleatory contracts, it is always possible that an insurer may never have to pay policyholders any money whatsoever. For example, if a person buys a health insurance policy and then never visits the doctor or gets injured during the policy period, the insurer may collect premiums and never pay the insured without violating the contract. On the other hand, an insurance company can collect more in premiums than it ever pays out in benefits, as in a fire insurance policy under which the protected property is either damaged or destroyed. Most insurance contracts are aleatory in nature. Aleatory (偶然性)¶ Insurance contracts are aleatory. This means there is an element of chance and potential for unequal exchange of value or consideration for both parties. An aleatory contract is conditioned upon the occurrence of an event. Consequently, the benefits provided by an insurance policy may or may not exceed the premiums paid. An aleatory contract is a contract between two parties with agreements contingent on a specific event or occurrence. For example, insurance policies are considered aleatory contracts, because the policy does not go to work for the consumer until the event itself comes to pass. Then and only then will the policy allot the consumer the agreed amount Aleatory Contract. An agreement concerned with an uncertain event that provides for unequal transfer of value between the parties. Insurance policies are aleatory contracts because an insured can pay premiums for many years without sustaining a covered loss. Aleatory Feature of insurance contracts in that there is an element of chance for both parties and that the dollar given by the policyholder (premiums) and the insurer (benefits) may not be equal. We hope the you have a better understanding of the meaning of Aleatory .
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