Aleatory Law and Legal Definition

Aleatory means dependent on chance, luck, or an uncertain outcome. It is usually used to refer to a type of contract in which one of the parties exposes himself to lose something which will be a profit to the other. Insurance contracts in which the insurer takes all the risk of the loss, and the insured pays a premium to the former for the risk which he runs are a type of aleatory contract.

It may also refer to a type of contract involving a gamble on an outcome, such as an annuity. When a person buys an annuity, he runs the risk of losing the consideration if he dies soon after, but may receive much more than he paid for the contract if he lives long enough.