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Customs brokerage and international shipping terms guidance

Incoterms® 2020

CIP - Carriage and Insurance Paid To

Under CIP, the seller pays carriage to the named destination place and must also obtain cargo insurance for the buyer’s benefit. Risk still transfers at origin handoff to the carrier.

Any mode · Named place of destination

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CIP at a glance

Under CIP, the seller pays carriage to the named destination place and must also obtain cargo insurance for the buyer’s benefit. Risk still transfers at origin handoff to the carrier.

Any mode or multimodalInsurance required by the rule: Yes (seller)

Shipment

Named location
Named place of destination
Delivery point
When goods are handed to the first carrier
Risk transfer
When goods are handed to the first carrier

Responsibilities

Main carriage
Seller arranges and pays
Export clearance
Seller
Import clearance
Buyer
Insurance
The seller must obtain insurance complying with the CIP rule’s coverage standard for the buyer’s benefit.

Contract

Common comparison
Compare with CPTCPT is similar but without a seller insurance obligation.

Illustrative notation: CIP Frankfurt airport cargo terminal, Incoterms® 2020. Customize and copy below ->

Responsibility journey

Delivery point
When goods are handed to the first carrier
Risk transfer
When goods are handed to the first carrier
Seller sideBuyer sideDelivery + risk transfer

  1. Seller / exporter

    Cost
    Seller

  2. Origin pickup

    Cost
    Seller

  3. Export clearance

    Cost
    Seller
    Export
    Seller

  4. Origin terminal

    Cost
    Seller

  5. Carrier handoff

    Cost
    Seller
    Handoff
    Delivery + risk transfer

  6. Main carriage

    Cost
    Seller

  7. Destination terminal

    Cost
    Buyer

  8. Import clearance

    Cost
    Buyer
    Import
    Buyer

  9. Final delivery

    Cost
    Buyer

  10. Buyer / importer

    Cost
    Buyer
Text alternative for CIP: Seller-paid cost through Main carriage. Delivery occurs at Carrier handoff. Risk transfer at Carrier handoff. Insurance: The seller must obtain insurance complying with the CIP rule’s coverage standard for the buyer’s benefit. Export clearance: Seller. Import clearance: Buyer. Main carriage: Seller.

Who pays what under CIP?

CIP mirrors CPT on delivery and risk, but adds a seller insurance obligation suitable for any transport mode.

Seller does

  • Contract and pay carriage to the named place
  • Obtain the required cargo insurance
  • Complete export clearance

Buyer does

  • Bear risk after handoff to the first carrier
  • Handle import clearance
  • Review whether additional insurance is needed beyond the rule minimum

Not determined by the CIP rule alone

  • Title transfer or payment terms

When to use CIP

When CIP fits

  • Multimodal shipments where the seller books freight and must provide insurance

When to use CIP with caution

  • Buyers who need higher insurance limits than the rule baseline

CIP shipment example

A seller pays air carriage to Frankfurt and buys the CIP-required insurance for the buyer. Risk transfers when the goods are handed to the first carrier at origin, not when the aircraft lands.

Common mistakes

  • Assuming CIP risk transfers at destination because insurance exists
  • Confusing CIP (any mode) with CIF (sea/inland waterway)

How do you write CIP in a contract?

Include the acronym, the exact named location, and the edition.

Contract notation builder

Build an illustrative line with the acronym, named place or port, and Incoterms® 2020. Parties must agree the exact location; this does not create a contract.

CIP Frankfurt airport cargo terminal, Incoterms® 2020

Edition is fixed to Incoterms® 2020. Catalog example: CIP Frankfurt airport cargo terminal, Incoterms® 2020

Does CIP include insurance?

The seller must obtain insurance complying with the CIP rule’s coverage standard for the buyer’s benefit.

CIP compared with related terms

Use these comparisons when the shipment mode, handoff point, or insurance need does not match CIP.

  • CIP vs. CPT

    CPT is similar but without a seller insurance obligation.

    CPT is similar but without a seller insurance obligation.

    Open CPT details ->

  • CIP vs. CIF

    CIF is limited to sea/inland waterway and uses a named port of destination.

    CIF is limited to sea/inland waterway and uses a named port of destination.

    Open CIF details ->

View all Incoterms(R) 2020 terms in the comparison matrix

Frequently asked questions

Does CIP insurance mean risk transfers at destination?

No. Under CIP Incoterms® 2020, risk still transfers when goods are handed to the first carrier. Insurance is a separate seller obligation.

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Unsure which shipping term fits your movement?

Talk with a Crane trade or customs specialist about transport mode, handoff points, documentation, and clearance responsibilities. This guidance is educational and is not legal advice; the parties remain responsible for selecting contractual terms.

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Last reviewed July 30, 2026. Edition reference: Incoterms® 2020 (not a new calendar-year edition).