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What is CIF – Cost, Insurance & Freight ?

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CIF

What is CIF?

CIF – Cost, Insurance & Freight (named port of destination)

This term is identical to CFR but adds the responsibility of purchasing insurance for the goods while in transit to the named port of destination. CIF requires the seller to insure the goods for 110% of their value under at least the minimum cover of the Institute Cargo Clauses of the Institute of London Underwriters (Institute Cargo Clauses (C)). The policy must be in the same currency as the contract of sale of goods. The seller must also turn over documents necessary, to obtain the goods from the carrier or to file a claim against the insurer. These documents usually include the invoice, the insurance policy, and the bill of lading. The seller's obligation ends when the documents are handed over to the buyer. Another point to consider is that CIF should only be used for non-containerized ocean freight. The Incoterm CIP would apply to all other modes of transport. 

Tags: incoterms

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