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Sea and inland waterway only

CIF – Cost, Insurance and Freight

Same as CFR, plus the seller buys minimum cargo insurance for the buyer up to the destination port.

Where delivery happens

When the goods are on board the vessel at the port of shipment.

The seller

  • Export clearance
  • Ocean freight to the named destination port
  • Minimum cargo insurance (Institute Cargo Clauses (C) or similar) for at least 110% of the contract value

The buyer

  • Risk from loading on board (protected by the seller's policy)
  • Import clearance, duty and GST/VAT

When risk passes

Passes on board at the port of shipment.

When to use CIF

Sea cargo, often bulk commodities or where a letter of credit requires CIF.

Watch out

Only minimum insurance cover is required under CIF. Agree higher cover in the contract if the goods are fragile or valuable.

Example

CIF Fremantle: the seller ships and insures to Fremantle; the buyer clears and pays duty and GST.

How it appears on the invoice

Write the three-letter code, the named place and the rules version, for example CIF Fremantle (Incoterms® 2020). The full name is not needed on the document. In Vendara Trade Documents you pick CIF – Cost, Insurance and Freight from the list and the invoice prints just CIF with your named place.

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Frequently asked questions

What does CIF mean?

CIF stands for Cost, Insurance and Freight (Incoterms® 2020). Same as CFR, plus the seller buys minimum cargo insurance for the buyer up to the destination port.

Where does risk pass under CIF?

Passes on board at the port of shipment.

Who pays import duty and GST under CIF?

The buyer pays import clearance, duty and import GST or VAT.

When should I use CIF?

Sea cargo, often bulk commodities or where a letter of credit requires CIF.

← CFR – Cost and Freight · All Incoterms · EXW – Ex Works →

General information only, not legal, tax or customs advice. Always confirm the right term for a shipment with your customs broker or freight forwarder. Incoterms® is a registered trademark of the International Chamber of Commerce (ICC); the full rules are published by ICC.