§ 41-02-49 — (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 the buyer 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
subdivision 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 the seller and, if the identification is by the seller
alone, the seller 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.