What is an aleatory contract?

An aleatory contract is characterized by its reliance on an uncertain event, which means the values exchanged within the contract are contingent upon that event occurring. In the context of insurance, for instance, the insurer agrees to pay a claim only if specific conditions are met—such as a loss or damage occurring. The outcome and the corresponding performance are uncertain, making it fundamentally different from other types of contracts where equal values are exchanged or where fixed values are predetermined.

This type of contract illustrates the principle of risk transfer; one party assumes a risk and the likelihood of that risk materializing determines the actual value exchanged. This element of chance is what distinguishes aleatory contracts, making them inherently unequal concerning the timing and amount of benefits received by the parties involved.

In contrast, contracts with equal values exchanged or those based on fixed values do not encapsulate the essence of uncertainty that defines an aleatory contract. Regular payment contracts introduce different dynamics concerning timing and structure but do not pertain to the contingent nature of exchanges present in aleatory agreements.