Sec. 42a-2-501. Insurable interest in goods; manner of identification of goods.
Sec. 42a-2-501. Insurable interest in goods; manner of identification of goods.
(1) The buyer obtains a special property and an insurable interest in goods by identification of existing goods as goods to which the contract refers even though the goods
so identified are nonconforming and he has an option to return or reject them. Such
identification can be made at any time and in any manner explicitly agreed to by the
parties. In the absence of explicit agreement identification occurs (a) when the contract
is made if it is for the sale of goods already existing and identified; (b) if the contract
is for the sale of future goods other than those described in paragraph (c), when goods
are shipped, marked or otherwise designated by the seller as goods to which the contract
refers; (c) when the crops are planted or otherwise become growing crops or the young
are conceived if the contract is for the sale of unborn young to be born within twelve
months after contracting or for the sale of crops to be harvested within twelve months
or the next normal harvest season after contracting, whichever is longer.
(2) The seller retains an insurable interest in goods so long as title to or any security
interest in the goods remains in him and where the identification is by the seller alone
he may until default or insolvency or notification to the buyer that the identification is
final substitute other goods for those identified.
(3) Nothing in this section impairs any insurable interest recognized under any other
statute or rule of law.
(1959, P.A. 133, S. 2-501.)
Cited. 198 C. 624.