Our glossary simplifies common industry terms in freight and logistics into clear, easy-to-understand explanations.
Cost, Insurance, and Freight (Cost, Insurance and Freight) is an international trade term similar to CFR, but in addition to covering freight, the seller is also required to purchase and pay insurance premiums. This ensures minimal protection for the goods during transit, allowing the buyer to recover damages through insurance. CIF terms are widely used in commodity trade, particularly when buyers lack knowledge of logistics and insurance. While ostensibly more advantageous to buyers, since sellers only need to purchase minimum liability insurance, buyers still need to assess whether to purchase additional coverage. Understanding CIF can help companies balance risk and cost when entering into international contracts.
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