CIF (Cost, Insurance and Freight)

CIF (Cost, Insurance and Freight) is a commonly used term in international trade, with the full name Cost, Insurance and Freight. It means that the seller is responsible for delivering the goods to the designated port of destination and paying the freight and insurance premiums, but the risk transfers to the buyer when the goods pass the ship's rail at the port of shipment. CIF applies to sea and inland waterway transport and is often used in scenarios where the buyer wants the seller to arrange transportation and insurance. When using CIF, the seller should note: 1) must sign a transport contract and pay freight to the port of destination; 2) arrange cargo transport insurance and pay the insurance premium; 3) promptly provide the buyer with transport documents and insurance policy. Unlike FOB (Free on Board), under CIF the seller bears the responsibility for transportation and insurance, while under FOB the buyer is responsible. Compared with CFR (Cost and Freight), CIF includes an additional insurance obligation. In addition, under the CIF term, the seller's delivery obligation is completed at the port of shipment, and the risk transfers earlier, so the buyer needs to pay attention to the risk of the goods during transit. CIF is a symbolic delivery, where the seller delivers against documents and the buyer pays against documents.