A Triggering Event is a specific event or occurrence that changes the rights, obligations, or expectations between the parties in a contract. Triggering events are often stipulated in contract's contingency clauses and are meant to protect the party or parties involved in case of a catastrophic or unexpected change.

Triggering events vary depending on the nature of the contract, but some examples of the most common include job loss, retirement, or the death of a party. Triggering events are particularly important in insurance contracts, because they help to initiate a claim if the event or occurrence specified in the policy terms and conditions should happen.

For example, if two parties agree to an insurance policy that guarantees coverage in case of medical disability, the triggering event might be the disability itself. If that event occurs, then the parties may be in a position to file a claim on the policy and collect whatever benefits or compensation the policy promises.

Triggering events are also important for non-insurance contracts. For example, a business may use a triggering event in a contract with a contractor for services to ensure the expectations of both parties involved are met. That triggering event might be a date or a milestone. Once the date is reached or the milestone has been achieved, the contractor is responsible for delivering the agreed-upon service and the business can begin to benefit from that service.

No matter what the original contract entails, triggering events help to prevent, protect, or ensure that the terms of the contract can be altered if the unexpected should happen. Without triggering events, the parties would have to renegotiate their contract whenever the unexpected were to occur. With triggers in place, the contract becomes more flexible and fair to all parties involved.