CIP — Carriage and Insurance Paid To (Incoterms 2020)
CIP — Carriage and Insurance Paid To (Incoterms® 2020). Risk transfers when goods are handed over to the first carrier at the origin.. Freight included. Insurance: A-level maximum (all risk).Generate compliant CIP documents in 60 seconds. Free up to 3/month.
infoCIP at a Glance
Responsibilities
- Risk Transfer
- When goods are handed over to the first carrier at the origin.
- Cost Responsibility
- Seller bears transport costs to named destination plus insurance. Buyer bears import clearance, duties, inland transport.
- Transport Mode
- Any mode (road, rail, air, sea)
- Freight Included
- Yes — seller arranges & pays main carriage
- Insurance Included
- Yes — A-level maximum (all risk)
- Category
- Main Carriage Paid (C)
When to Use CIP
- For multimodal transport with high-value cargo
- When buyer wants comprehensive insurance
- For electronics, pharmaceuticals, fragile goods
When NOT to Use CIP
- For bulk commodities where C-level insurance is sufficient (use CFR/CIF)
- When seller refuses higher insurance costs
articleCIP Explained — Practical Guide
What CIP Means in Plain Language
CIP (Carriage and Insurance Paid To (Incoterms® 2020)) is an Incoterms® 2020 term in Category C — main carriage paid. Under CIP, the seller when goods are handed over to the first carrier at the origin.and pays for main carriage to the named destination. The seller must also procure A-level maximum (all risk) insurance coverage.
Step-by-Step: Who Does What
- Seller: Makes goods available at the named place.
- Export clearance: Seller arranges & pays for export clearance.
- Main carriage: Seller contracts & pays carrier to named destination.
- Risk transfers: When goods are handed over to the first carrier at the origin.. After this point, loss/damage is buyer's risk.
- Insurance: Seller buys A-level maximum (all risk) coverage for buyer's benefit.
- Import clearance: Buyer arranges & pays for import clearance, duties, taxes at destination.
- Final delivery: Buyer unloads at destination.
Common CIP Mistakes to Avoid
- Using CIP for sea shipments — mode mismatch invalidates the term.
- Not naming the precise place/port — "CIP China" is invalid; use "CIP Shanghai" or "CIP Guangzhou".
- Assuming insurance is included when it's not — only CIP and CIF include seller-procured insurance.
- Confusing risk transfer with cost transfer — they happen at different points in C-terms.
- Missing "Incoterms® 2020" in contract — without edition, old 2010 rules may apply.
local_shippingCarrier Implementation Notes for CIP
local_shippingFedEx
- • Terms of Sale field: CIP + named place
- • Freight prepaid — seller provides carrier docs
- • Insurance declared on CI
- • Air waybill (12-digit FedEx / 1Z UPS / 10-digit DHL)
inventory_2UPS
- • Terms of Sale field: CIP + named place
- • Freight prepaid — seller provides carrier docs
- • Insurance declared on CI
- • Air waybill (12-digit FedEx / 1Z UPS / 10-digit DHL)
deployed_codeDHL
- • Terms of Sale field: CIP + named place
- • Freight prepaid — seller provides carrier docs
- • Insurance declared on CI
- • Air waybill (12-digit FedEx / 1Z UPS / 10-digit DHL)
downloadFree: Incoterms® 2020 Cheat Sheet (PDF)
One-page reference: all 11 terms, risk transfer points, cost matrix, when to use each. Perfect for your desk or forwarding team.
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