Aleatory Contract
Definition of "Aleatory contract"
Contract that may or may not provide more in benefits than premiums paid. For example, with only one premium payment on a property policy an insured can receive hundreds of thousands of dollars should the protected entity be destroyed. 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.
Popular Insurance Terms
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Attachment to an insurance policy to complete its coverage. For example, the Standard Fire Policy must have certain forms attached for it to provide the coverage desired. ...
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Use of a home, and the land and buildings surrounding that home, free from the claim of creditors. This right gives rise to an insurable interest. ...
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