Question

Stella Blue gets in a serious car accident 2 months after buying a new policy and only paying $700 in premiums. Her insurer had to pay $500,000; this is an example of what type insurance contract characteristic?

Answer 1

Aleatory

Explanation:

This is an example of Aleatory type of insurance contact.

Definition:

A contract preoccupied with an unclear occurrence that delivers for imbalanced transfer of worth between the parties. Insurance plans are discretionary investments and, after sustaining a reported loss, a person must pay premiums for many years. Most insurance policies are aleatory contacts.