Who pays for insurance under CIF?

Under CIF the seller must arrange cargo insurance. At least the limited cover of the Institute Cargo Clauses (C); the parties can agree higher cover.

Who is responsible for unloading at destination under CIF?

Sources differ. One says the seller pays for unloading at the destination when its contract of carriage includes it; another puts unloading on the buyer. Check what the freight contract covers.

CIF (Cost, Insurance and Freight) Incoterms® 2020 rule

As CFR, the seller pays sea freight to the destination port and risk passes on board, but it must also insure for the buyer.

In our own words, checked against public explanatory sources. The official rule text is published by ICC.

Transport mode: Sea and inland waterway only
Risk passes: On board the ship at the port of shipment
Seller must insure?: Yes

Who pays, at a glance

Seller pays or arranges:: packaging, loading at origin, export clearance, pre-carriage, main carriage, insurance.
Buyer pays or arranges:: import clearance, import duties, on-carriage.
Depends on the delivery place or arrangement:: unloading at destination — see the notes in the cost table.

Where risk passes

Risk passes once the goods are on board the ship at the port of shipment, even though the seller pays freight and insurance to the destination port.

Cost and risk diagram

Rows follow the goods from the seller (top) to the buyer (bottom); the dashed line marks where risk passes. Generated from the table below. Positions are schematic — the named place in your contract decides the exact point.

Who pays for what

Cost item	Paid / arranged by	Notes
Packaging	Seller
Loading at origin	Seller	Includes loading the goods onto the ship at the port of shipment.
Export clearance	Seller
Pre-carriage	Seller
Main carriage	Seller
Insurance	Seller	The seller buys the policy for the sea voyage, but the buyer is the one who can claim under it.
Unloading at destination	Depends	Sources differ. One says the seller pays for unloading at the destination when its contract of carriage includes it; another puts unloading on the buyer. Check what the freight contract covers.
Import clearance	Buyer
Import duties	Buyer
On-carriage	Buyer	Transport from the port of destination to an inland place is the buyer's.

Insurance

The seller must arrange cargo insurance under this rule. At least the limited cover of the Institute Cargo Clauses (C); the parties can agree higher cover.

Common mistakes

Assuming the seller carries the risk until the destination port because it pays freight and insurance; risk passes at loading.
Treating the default insurance as broad cover; it is the most limited level, and war, strikes and riots need extra cover.
Using CIF for container shipments; sources suggest CIP, where risk passes when the container is handed to the carrier.

In your ERP and on invoices

Practical consequences of the cost split above for order data, cost bookings and invoice layout. Generic — not specific to any ERP product.

Store the rule code, the edition (for example 2020) and the named place as separate fields on orders, and print all three on the invoice.
Main-carriage freight is a seller cost: expect it on the sales side (as a freight line or built into the price), not as a separate line on the buyer's purchase order.
Cargo insurance is paid by the seller: if you track insurance as a separate cost, book it against the sale.
Import duties are a buyer cost: the buyer's landed-cost calculation should add duties and clearance fees on top of the purchase price.

When to look at another rule

Derived from the cost tables: rules for the same kind of route that differ from CIF in one of export clearance, main carriage, import clearance or insurance.

If the seller should not have to insure: CFR.

Compare CIF with

Questions about CIF

Where does risk pass from seller to buyer under CIF?: Risk passes once the goods are on board the ship at the port of shipment, even though the seller pays freight and insurance to the destination port.
Which transport modes can CIF be used for?: Sea and inland waterway only.
Who pays for insurance under CIF?: Under CIF the seller must arrange cargo insurance. At least the limited cover of the Institute Cargo Clauses (C); the parties can agree higher cover.
Who is responsible for export clearance under CIF?: The seller.
Who is responsible for main carriage under CIF?: The seller.
Who is responsible for import clearance under CIF?: The buyer.
Who is responsible for import duties under CIF?: The buyer.
Who is responsible for unloading at destination under CIF?: Sources differ. One says the seller pays for unloading at the destination when its contract of carriage includes it; another puts unloading on the buyer. Check what the freight contract covers.

Sources

Checked on 11 October 2026.

Export Development Canada — edc.ca
Netherlands Chamber of Commerce (KVK) — kvk.nl
UK Department for Business and Trade (business.gov.uk) — business.gov.uk
International Chamber of Commerce — iccwbo.org
US International Trade Administration — trade.gov
Maersk (chart by Pilot Freight Services) — delivers.maersk.comsecondary