§ 4-2.5-218 — Insurance and proceeds

Colorado § 4-2.5-218

• Jurisdiction: Colorado
• Title 04: Uniform
• Art.: Leases

Text

(1) 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.

(2) 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.

(3) Notwithstanding a lessee's insurable interest under subsections (1) and
(2) of this section, 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.

(4) Nothing in this section impairs any insurable interest recognized under
any other statute or rule of law.

(5) 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.

Legislative History

Source: L. 91: Entire article added, p. 286, � 1, effective July 1, 1992.