we’ll explore everything you need to know about CIF in shipping, when to use it, its pros and cons, and how Daguer Logistics helps brands manage global logistics with CIF and beyond.
Navigating international shipping can be a daunting task for ecommerce brands. From managing freight and insurance to customs clearance and risk mitigation, there are countless moving parts. One of the most commonly used Incoterms® for international shipping is CIF: Cost, Insurance, and Freight.
At Daguer Logistics, we help ecommerce businesses around the world streamline their international fulfillment to the United States and Canada, ensuring clarity and confidence in every shipping contract — including those that involve CIF.
In this guide, we’ll explore everything you need to know about CIF in shipping, when to use it, its pros and cons, and how Daguer Logistics helps brands manage global logistics with CIF and beyond.
CIF stands for Cost, Insurance, and Freight. It’s one of the 11 Incoterms® defined by the International Chamber of Commerce (ICC), governing responsibilities between sellers and buyers in international trade.
· The seller pays for the cost of shipping, marine insurance, and freight to the destination port.
· The risk transfers to the buyer once the goods are loaded on the shipping vessel.
CIF is used exclusively for ocean and inland waterway transport and is ideal when the seller has direct access to vessels.
CIF is best used in scenarios where:
· Goods are shipped bulk or breakbulk, not containerized.
· The seller can handle export documentation and book space on a vessel.
· The buyer prefers a turnkey international freight arrangement, with minimal upfront obligations.
At Daguer Logistics, we often recommend CIF for sellers who want to manage international freight up to the buyer's port but prefer not to assume delivery risks beyond that.
There are limitations to CIF that ecommerce sellers and buyers should be aware of:
· Containerized cargo: Damage can occur inside the container before vessel loading, creating ambiguity in risk transfer.
· Air or land shipments: CIF is only applicable for water-based transport.
In such cases, Incoterms® like FCA, CPT, or CIP are more appropriate, especially for multimodal or container-based logistics.
· Product packaging
· Export licenses and documentation
· Pre-shipment inspection and certifications
· Freight cost from seller’s port to buyer’s port
· Marine insurance coverage (minimum 110% of goods value)
· Export customs clearance
· Loading goods onto the vessel
· Import duties, taxes, and customs clearance at the destination port
· Port unloading fees
· Inland transportation to the final destination
· Risk of loss or damage once goods are loaded onto the vessel (though covered by seller’s insurance)
One of the biggest misconceptions about CIF is when risk transfers.
· Cost transfer happens once the goods arrive at the buyer’s destination port.
· Risk transfer occurs once the goods are loaded onto the vessel at the seller’s port.
This means that while the seller pays for freight and insurance, the buyer owns the goods (and assumes risk) from the point they are onboarded onto the vessel.
If goods are damaged while sitting in a container at the dock (before loading), the seller is responsible. If goods are damaged after loading onto the ship, the buyer must file a claim with the seller’s insurance.
Both CIF and Free On Board (FOB) are Incoterms® for sea freight, but they differ in cost and risk allocation.
CIF is generally preferred by less experienced buyers, while FOB may be better for buyers with existing freight and insurance arrangements.
The latest version of Incoterms® (2020) updated CIF obligations:
· Sellers must now purchase higher insurance coverage than under Incoterms 2010.
· Enhanced security protocols are required for all shipments.
Daguer Logistics ensures our clients' CIF contracts comply with Incoterms® 2020, especially when fulfilling from Europe, Asia, or Latin America into the USA or Canada.
✅ Simplified for buyers: Seller handles shipping and insurance.
✅ Predictable cost structures for freight and coverage.
✅ Ideal for bulk and breakbulk ocean cargo.
❌ Risk transfers early, buyers are liable once goods are loaded.
❌ Limited to water transport only.
❌ Not ideal for containerized goods.
At Daguer Logistics, we help ecommerce brands manage CIF-based fulfillment by offering:
✔️ Freight Coordination: We work directly with ocean carriers to schedule and monitor CIF freight routes into U.S. and Canadian ports.
✔️ Insurance Management: We ensure sellers meet Incoterms® 2020 insurance requirements and help buyers file claims if goods are damaged in transit.
✔️ Customs Clearance: We partner with licensed customs brokers to clear CIF shipments efficiently through ports like Los Angeles, Toronto, or Newark.
✔️ Local Delivery Fulfillment: Once CIF shipments arrive at destination ports, we offer inland transportation and last-mile delivery across North America.
Cost, Insurance, and Freight (CIF) offers clear advantages for ecommerce businesses that want to simplify their shipping operations and provide better service to their buyers. But it also comes with limitations and risks that must be carefully managed.
Whether you’re importing bulk shipments from overseas or testing new international markets, Daguer Logistics can help you navigate CIF shipping contracts with confidence and clarity.
From freight coordination to customs clearance and inland distribution, we’re your all-in-one logistics partner for CIF and beyond.
Contact Daguer Logistics to see how we can support your CIF shipping and international logistics needs.
CIF stands for Cost, Insurance, and Freight. It means the seller covers the cost of transporting goods by sea and insuring them up to the destination port.
No. CIF includes export customs clearance, freight, and insurance, but import duties and taxes at the destination are the buyer’s responsibility.
No. CIF only applies to sea or inland waterway transport. Use CIP or CPT for air or multimodal shipments.
The buyer assumes the risk once goods are loaded onto the vessel, even though the seller still pays for shipping and insurance.
It’s not recommended. Use Incoterms® like FCA, CPT, or CIP for container shipments to avoid unclear risk transfer.
We coordinate CIF freight, ensure proper insurance coverage, partner with customs brokers, and provide final-mile delivery throughout the U.S. and Canada.
