Our glossary simplifies common industry terms in freight and logistics into clear, easy-to-understand explanations.
Freight and Insurance Paid To (CFR and CIF) are common pricing terms used in international trade. CFR (Cost and Freight) means the seller pays the freight to the port of destination, but does not include insurance. CIF (Cost, Insurance, and Freight) adds CFR but also requires the seller to cover insurance. Both terms share the same prinCarriage and Insurance Paid Tole: the risk of the goods transfers to the buyer once the goods pass the ship's rail at the port of shipment. In practice, CFR and CIF are commonly used in large-volume ocean freight transactions. Buyers should note that while the seller pays the freight (and, in the case of CIF, the insurance premium), the risk is already transferred. Therefore, when choosing contract terms, companies should assess insurance coverage and risk tolerance to ensure transaction security.
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