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The answer to which is better, CIF or CFR, is complex. It depends on the seller and buyer's position and the insurance company's reliability. CFR and CIF Incoterms are very similar, the only difference being insurance. Importers may prefer CIF to ensure the cargo is insured during transport. Still, mandatory insurance is usually minimum ...
- Cost and Freight vs. Cost, Insurance, and Freight: An Overview
- Cost and Freight
- Cost, Insurance, and Freight
- Cost and Freight vs. Cost, Insurance, and Freight Example
- The Bottom Line
Cost and freight (CFR) is a trade term that requires the seller to transport goods by sea to a required port. Cost, insurance, and freight(CIF) is what a seller pays to cover the cost of shipping, as well as the insurance to protect against the potential damage of loss to a buyer's order. The two are part of a larger group of international trade ru...
Cost and freight is a legal agreement between a buyer and a seller in international trade. The rule applies to goods that are transported by sea. It requires the seller to transport goods by sea to the buyer's (required) destination. The cost, therefore, is borne by the seller. Under CFR, the seller is also required to give the buyer the documentat...
Like CFR, CIF is restricted for use between parties who deal in goods that are transported by sea. CIF agreements are also nearly the same as CFR agreements. The selleris still responsible for all arrangements and transport costs for shipping goods to the agreed-upon destination port. The receiver then assumes all cost responsibilities once the goo...
Company A in Morocco sells goods to a buyer in the U.S., Company Z. Company A pays for the shipping from Morocco to the U.S. and is responsible for the shipment until the goods are loaded on the vessel, at which point Company Z bears responsibility, which applies for both CFR and CIF. Under CIF, the additional stipulations require that Company A pu...
CFR and CIF are both very similar terms that relate to transporting goods by sea where the primary responsibility lies with the seller, particularly in the cost of shipping the freight. The difference between the two is that CIF requires marine insurance to be included, paid by the seller, that provides protection against any damages to the goods.
- J.B. Maverick
People also ask
What is the difference between CFR and CIF?
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What is Cost Insurance & Freight (CIF)?
- A guide to shipping terms and incoterms. Cost and Freight (CFR), Cost, Insurance and Freight (CIF) and Free on Board (FOB) are three of the terms included in the International Chamber of Commerce’s International Commerce Terms (Incoterms).
- Incoterms – All you need to know. What are incoterms? The Incoterms are a series of pre-defined commercial terms designed to help prevent confusion in foreign trade contracts by clarifying the obligations of buyers and sellers.
- Cost and Freight (CFR) CFR is among the most popular Incoterms used, however, as highlighted by our Incoterm expert Bob Ronai, it is often used without reference to any version of the Incoterm rules.
- Cost, Insurance and Freight (CIF) The difference is minimal between a CIF agreement and a CFR agreement. Under both terms, the seller assumes the responsibility for all of the arrangement and transportation costs for shipping products to the agreed-upon destination port while the buyer assumes all further responsibilities, including those relating to cost once the ship has reached port.
Nov 10, 2020 · Understanding the differences between similar incoterms is critical to choosing the right one for your shipment. Cost and Freight (CFR) and Cost, Insurance, and Freight (CIF) are two Incoterms that define buyer and seller responsibilities in an international trade where the goods are transported by sea.
Incoterms ® 2010 defines 11 rules, down from the 13 rules defined by Incoterms ® 2000. Four rules of the 2000 version [DAF (Delivered at Frontier, DES (Delivered Ex Ship), DEQ (Delivered Ex Quay), DDU (Delivered Duty Unpaid)] were removed, and are replaced by two new rules [ DAT (Delivered at Terminal), DAP (Delivered at Place)] in the 2010 rules.
Dec 12, 2020 · CFR is a short form of “Cost and Freight”. Therefore, sometimes it is written as “C&F”（C and F）, but the correct short form is “CFR”. CIF is a short form of “Cost, Insurance and Freight”. The difference between CFR and CIF is insurance, “I” stands for “Insurance”, which makes it easy to remember. With CIF, it is the ...
May 24, 2022 · Meaning of CFR and CIF. Cost and Freight (CFR) and Cost, Insurance, and Freight (CIF) are the last two trade terms of the total 11 Incoterms ® Rules, and apply only to sea and inland waterway transport. Under CFR and CIF, the seller assumes the costs of loading the goods onto the vessel for departure, as well as cost of carriage to the port of ...
