CIF vs DDP: who pays what

CIF is Cost, Insurance and Freight. DDP is Delivered Duty Paid. Incoterms 2020.

The difference that matters

Full cost split

Cost blockCIFDDP
Export clearanceSellerSeller
Carriage to port / terminalSellerSeller
Loading onto main carriageSellerSeller
Main carriage (freight)SellerSeller
InsuranceSellerNeither obliged
Unloading at destinationBuyerBuyer
Import clearanceBuyerSeller
Duties and import taxesBuyerSeller
Risk passesWhen the goods are loaded on board at origin — same as CFR.At the named destination, ready for unloading, after import clearance.
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.

DDP

Many countries will not let a non-resident seller act as importer of record, and unrecoverable import VAT quietly becomes a cost.

Questions

What is the main difference between CIF and DDP?
They split 3 cost blocks differently. insurance falls to the seller under CIF and the none under DDP; import clearance falls to the buyer under CIF and the seller under DDP; duties and import taxes falls to the buyer under CIF and the seller under DDP.
Where does risk pass under CIF?
When the goods are loaded on board at origin — same as CFR.
Where does risk pass under DDP?
At the named destination, ready for unloading, after import clearance.
Can CIF and DDP both be used for container shipments?
DDP 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 DDPCIF vs CIPCIF vs CPTCIF vs DAPCIF 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.