After title passes to a buyer, a seller no longer has an insurable interest in the goods. True or False?
Understand the Problem
The question is asking whether it is true or false that after the title of goods passes to a buyer, the seller no longer has an insurable interest in those goods.
Answer
True
The statement is typically true. Once title passes to the buyer, the seller generally no longer retains an insurable interest in the goods.
Answer for screen readers
The statement is typically true. Once title passes to the buyer, the seller generally no longer retains an insurable interest in the goods.
More Information
A seller retains an insurable interest in goods as long as they have title or a security interest in them. Once title passes to the buyer, the seller no longer has this interest unless other agreements are in place.
Tips
Remember, the transfer of title is key in determining where insurable interest lies. Be sure to review contract terms for any retained interests.
Sources
- An Analysis of Insurable Interest Under Article Two of the Uniform Commercial Code - scholarship.law.vanderbilt.edu
- CHAPTER 20 - GBA 362 - profiles.shsu.edu
- Blaw Ch 21 Flash Cards - quizlet.com
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