When is the earliest a buyer can claim an insurable interest in goods?
A) when title passes to the buyer
B) when the risk of loss passes to the buyer
C) when the seller identifies the goods to be sent to the buyer
D) The buyer does not have an insurable interest until the goods are delivered.
E) The buyer does not have an insurable interest until the goods are shipped.

Question

Quizplus · Accepted Answer

Insurable interest arises when the goods are identified as the specific goods that are to be shipped to the buyer. This happens when the seller identifies the goods to be sent to the buyer. The buyer does not need to take delivery or even pay for the goods to have an insurable interest. The buyer's ownership or title to the goods is not necessary to have an insurable interest. Therefore, options A, D, and E are incorrect. Additionally, risk of loss is different from insurable interest and does not determine when a buyer can claim an insurable interest. Therefore, option B is incorrect.

When Is the Earliest a Buyer Can Claim an Insurable