District Of Columbia § 28:2A-218 - Insurance and proceeds.
Full text of District Of Columbia D.C. Code § 28:2A-218 — Insurance and proceeds., with citation guidance and answers to common questions.
§ 28:2A-218. Insurance and proceeds.
28:2A-218A 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.
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.
Notwithstanding a lessee’s insurable interest under subsections (a) and (b) 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.
Nothing in this section impairs any insurable interest recognized under any other statute or rule of law.
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.
Annotations
HISTORICAL NOTES
“Party”. Section 1-201(29).
“Notification”. Section 1-201(26).
“Lessor”. Section 2A-103(1)(p).
“Lessee”. Section 2A-103(1)(n).
“Lease contract”. Section 2A-103(1)(l).
“Insolvent”. Section 1-201(23).
“Goods”. Section 2A-103(1)(h).
“Conforming”. Section 2A-103(1)(d).
“Buying”. Section 2A-103(1)(a).
“Agreement”. Section 1-201(3).
Sections 2-501, 2-501(2) and 2A-217.
Subsection (2) states a rule allowing substitution of goods by the lessor under certain circumstances, until default or insolvency of the lessor, or until notification to the lessee that identification is final. Subsection (3) states a rule regarding the lessor’s insurable interest that, by virtue of the difference between a sale and a lease, necessarily is different from the rule stated in Section 2-501(2) regarding the seller’s insurable interest. For this purpose the option to buy shall be deemed to have been exercised by the lessee when the resulting sale is closed, not when the lessee gives notice to the lessor. Further, subsection (5) is new and reflects the common practice of shifting the responsibility and cost of insuring the goods between the parties to the lease transaction.
This section, together with Section 2A-217, is derived from the provisions of Section 2-501, with changes and additions to reflect leasing practices and terminology.
Section 2-501.
Source: official District Of Columbia text · Last verified 2026-08-27
Frequently Asked Questions About District Of Columbia § 28:2A-218
What does D.C. Code § 28:2A-218 cover?
Section 28:2A-218 ("Insurance and proceeds.") is part of the D.C. Code, the codified statutory law of District Of Columbia. It sets out the legal rule or procedure described in the text above. Statutes are amended regularly, so always verify against the official source.
How do I cite District Of Columbia § 28:2A-218?
A common citation format is "D.C. Code § 28:2A-218" (District Of Columbia). Legal writing may require the code abbreviation, section number, and year or edition. Match the style required by your court, professor, or publisher.
Is this the official text of District Of Columbia law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the District Of Columbia official source linked on this page or consult a licensed District Of Columbia attorney.
How does District Of Columbia § 28:2A-218 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in District Of Columbia can advise on how this section applies to you. Contact your state or local bar association for a referral.
Sources & Verification
Not legal advice. Verify against the official source and consult a licensed attorney in District Of Columbia.