P&CNationaleasy
An insurance contract is described as aleatory. What does this mean?
AOnly one of the two parties makes a legally enforceable promise to perform for the other
The dollars exchanged by the parties are unequal and turn on a fortuitous event
CPerformance is conditioned on the insured first meeting all policy duties
DThe contract cannot be assigned to another party without the insurer's consent
Why this is the answer
An aleatory contract is one in which the values exchanged by the parties are unequal and the trigger for the larger performance is a chance event. The insured pays a relatively small premium, and the insurer's obligation to pay a potentially large loss arises only if a fortuitous covered event occurs. The other choices describe the unilateral, conditional and personal features. All four are features of insurance, but only the unequal, chance-dependent exchange defines aleatory.
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