For an insurance policy to be considered aleatory, what essential element must it contain?

An aleatory contract is characterized by an element of uncertainty, which is vital for insurance policies. In essence, an aleatory agreement involves a situation where the performance of one party (the insurer) depends on an uncertain event (like an accident, fire, or theft) occurring. This uncertainty refers to the fact that the amount of benefits paid out by the insurer is dependent on the occurrence of a specified event, which cannot be predicted with certainty.

In insurance, the premiums paid by the policyholder may be significantly less than the amount they could potentially receive in claims, which illustrates that the financial exchange is not equal and that unpredictability plays a major role. This distinction is what sets aleatory contracts apart from other types of agreements, where the rights and obligations are more symmetrically defined. Thus, the presence of uncertainty is essential for a policy to be recognized as an aleatory contract.