Trade & Incoterms
CIF (Cost, Insurance and Freight)
An Incoterm where the seller pays for cost, insurance, and freight to the named port of destination. Risk transfers when goods are on board at the port of shipment. The seller must procure minimum marine insurance for the buyer.
In depth
CIF requires the seller to pay freight and minimum marine insurance to the named port of destination, while risk still passes when goods are on board at origin. The insurance must meet Institute Cargo Clauses (C) or equivalent minimum cover. Buyers often top up insurance for full all-risk protection.
Key points
- Seller must provide insurance evidence (policy or certificate)
- Risk and insurance responsibility diverge: a common source of disputes
- Named port of destination must be precise
- Often used where the buyer wants a single quoted landed price at port