§ 2501. Insurable interest in goods; manner of identification of goods.
(a) General rule.--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 as follows:
(1) When the contract is made if it is for the sale of goods already existing and identified.
(2) If the contract is for the sale of future goods other than those described in paragraph (3), when goods are shipped, marked or otherwise designated by the seller as goods to which the contract refers.
(3) 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 12 months after contracting or for the sale of crops to be harvested within 12 months or the next normal harvest season after contracting whichever is longer.
(b) Duration of insurable interest and substitution of goods.--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.
(c) Other insurable interests unimpaired.--Nothing in this section impairs any insurable interest recognized under any other statute or rule of law.
Cross References. Section 2501 is referred to in sections 2103, 2401, 2502 of this title.Section: 2501 2502 2503 2504 2505 2506 2507 2508 2509 2510 2511 2512 2513 2514 Next
Last modified: October 8, 2016