47-2A218. Insurance and proceeds
A. A lessee obtains an insurable interest when existing goods are identified to the
lease contract even though the goods identified are nonconforming and the lessee has an
option to reject them.
B. If a lessee has an insurable interest only by reason of the lessor's
identification of the goods, the lessor, until default or insolvency or notification to
the lessee that identification is final, may substitute other goods for those identified.
C. Notwithstanding a lessee's insurable interest under subsections A and B, the
lessor retains an insurable interest until an option to buy has been exercised by the
lessee and risk of loss has passed to the lessee.
D. Nothing in this section impairs any insurable interest recognized under any
other statute or rule of law.
E. The parties by agreement may determine that one or more parties have an
obligation to obtain and pay for insurance covering the goods and by agreement may
determine the beneficiary of the proceeds of the insurance.
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