                                 CODE OF VIRGINIA

INSURABLE INTEREST IN GOODS; MANNER OF IDENTIFICATION OF GOODS (§ 8.2-501)

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.

HISTORY: 1964, c. 219.