# Incoterms risk transfer

*Last updated: 2026-06-26*

> In an international sales transaction, the chosen Incoterms rule pinpoints exactly where the risk of loss or damage to the goods passes from seller to buyer.

In an international sales transaction, the chosen Incoterms rule pinpoints exactly where the risk of loss or damage to the goods passes from seller to buyer. Under EXW, risk transfers as soon as goods are made available at the seller's premises; under FOB and FCA, at the moment of handover to the main carrier at origin. Under CIF and CFR, risk also transfers at origin — yet with CIF the seller still owes a transport insurance policy to the destination port, creating a deliberate split between cost and risk. Under DAP, DPU, and DDP, risk passes only at the named destination. Knowing this transfer point precisely is essential for cargo insurance cover and any subsequent liability claim.

**Source:** [https://iccwbo.org/business-solutions/incoterms-rules/](https://iccwbo.org/business-solutions/incoterms-rules/)

## Quick Facts

| Property | Value |
|---|---|
| Term | Incoterms risk transfer |
| Language | EN |
| Word count | 117 |
| Last updated | 2026-06-26 |
| Source | https://iccwbo.org/business-solutions/incoterms-rules/ |

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