Aleatory Legal Meaning and Definition
Here is a simplified definition of the legal term Aleatory.
In law, 'aleatory' refers to an unpredictable, uncertain event that may or may not happen and can change the outcome of a certain legal agreement or contract. This term is often used in contracts relating to insurance, gambling, or other risk-based transactions. The term arises from the Latin word 'alea', which means "dice", symbolizing the role of chance in these situations.
For example, in an insurance contract, the event (like a fire or accident) is aleatory because it might never occur, yet an insured person must make regular premium payments. If the event occurs, the insurance company must pay the agreed amount, which is often considerably larger than the total sum of premiums received. Thus, the exchange in an aleatory contract is unequal and depends upon uncertain future events.