CIFCost, Insurance and Freight
CIF (Cost, Insurance and Freight) means the seller pays the sea freight to the named destination port and buys cargo insurance for the buyer, at least Institute Cargo Clauses (C) for 110 % of the contract value, but risk passes once the goods are on board at the port of shipment. It is for sea and inland waterway only.
Where CIF hands over
The orange marker is where risk passes to the buyer. Blue bars are the seller's, yellow the buyer's.
CIF at a glance
- Transport
- Sea and waterwayNot for containers handed over at a terminal
- Risk passes
- On board vessel
- Main carriage
- Seller paysand arranges the contract
- Insurance
- Seller, ICC (C)110 % of the contract value
- Delivery point
- On board the vessel at the port of shipment, with freight and minimum insurance paid by the seller to the destination port.
| Job | Who |
|---|---|
| Export clearance | Seller |
| Loading at origin | Seller |
| Main carriage | Seller |
| Insurance | Seller, ICC (C) minimum |
| Unloading at destination | Buyer, unless in seller's freight contract |
| Import clearance and duties | Buyer |
When to use CIF
Use CIF when
- A letter of credit asks the seller for an insurance document
- Bulk or break-bulk sea cargo
- The buyer is content with minimum ICC (C) cover
Avoid CIF when
- Containers (use CIP)
- Manufactured goods that need all-risks cover, unless (A) is agreed
- The buyer prefers its own open-cover insurance
Common CIF mistakes
ICC (C) covers major casualties such as fire, sinking or collision, but not theft or most handling damage. For manufactured goods the buyer often needs ICC (A); agree it in the contract.
Paying for insurance does not mean the seller carries the risk. If the goods are damaged at sea, the buyer claims on the policy.
For containerised cargo use CIP, which also requires the wider ICC (A) cover.
CIF beside its neighbours
CIP works for any mode and requires ICC (A) cover, the broadest standard clauses. Read about CIP.
All eleven rules
Incoterms® is a registered trademark of the International Chamber of Commerce (ICC). CartonMath is not affiliated with or endorsed by the ICC. This is a plain-language summary; the full rules are published by the ICC and the contract wording governs.
Common questions
What does CIF mean?
CIF (Cost, Insurance and Freight) means the seller pays the sea freight to the named destination port and buys cargo insurance for the buyer, at least Institute Cargo Clauses (C) for 110 % of the contract value, but risk passes once the goods are on board at the port of shipment. It is for sea and inland waterway only.
When does risk pass under CIF?
On board the vessel at the port of shipment, with freight and minimum insurance paid by the seller to the destination port.
Who pays the main freight under CIF?
The seller arranges and pays the main carriage.
Who pays import duties under CIF?
The buyer clears the goods for import and pays any duties and taxes under CIF.
Can CIF be used for container shipments?
CIF is a sea and inland waterway rule. For containers, the ICC recommends CIP instead, because containers are handed over at a terminal before loading.