New Jersey § 12a:2a-218

§ 12a:2a-218.

(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), 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.