CIF vs CIP: who pays what

CIF is Cost, Insurance and Freight. CIP is Carriage and Insurance Paid To. Incoterms 2020.

The difference that matters

The cost split is identical. What separates them is where risk passes — see below.

Full cost split

Cost blockCIFCIP
Export clearanceSellerSeller
Carriage to port / terminalSellerSeller
Loading onto main carriageSellerSeller
Main carriage (freight)SellerSeller
InsuranceSellerSeller
Unloading at destinationBuyerBuyer
Import clearanceBuyerBuyer
Duties and import taxesBuyerBuyer
Risk passesWhen the goods are loaded on board at origin — same as CFR.When the goods are handed to the first carrier — same as CPT.
Transport modeSea / inland waterwayAny mode

What people get wrong

CIF

The required cover is the minimum level, not all-risks. Buyers who assume they are fully covered find out at claim time.

CIP

The 2020 revision raised CIP cover above CIF’s. Contracts copied from pre-2020 templates often still assume they match.

Questions

What is the main difference between CIF and CIP?
The cost split is identical. They differ in where risk passes: CIF — When the goods are loaded on board at origin — same as CFR. CIP — When the goods are handed to the first carrier — same as CPT.
Where does risk pass under CIF?
When the goods are loaded on board at origin — same as CFR.
Where does risk pass under CIP?
When the goods are handed to the first carrier — same as CPT.
Can CIF and CIP both be used for container shipments?
CIP works for any mode of transport. CIF is written for sea and inland waterway transport only.

Whichever term you agree, the paperwork has to say so

The Incoterm and named place belong on the commercial invoice, the packing list and the shipper's instructions — spelled the same way on each. ovrseas generates the set from one entry so they cannot disagree with each other.

Commercial invoice template

Compare other pairs

CFR vs CIFCFR vs CIPCIF vs CPTCIF vs DAPCIF vs DDPCIF vs DPUCIF vs EXWCIF vs FAS

Incoterms® is a registered trademark of the International Chamber of Commerce. This page is an independent summary of how costs and risk are allocated and is not affiliated with or endorsed by ICC. For contract drafting, use the official Incoterms® 2020 rules published by ICC.