GlossaryEN1 min readUpdated: Jun 26, 2026

Carriage and Insurance Paid to (CIP)

Exporters and freight forwarders turn to CIP (Carriage and Insurance Paid to) when they need to provide the buyer with both prepaid freight and a guaranteed minimum insurance cover to the named destination.

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Last updated: 26 June 2026Published: 27 January 2026

Source: https://iccwbo.org/business-solutions/incoterms-rules/

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Definition & Explanation

Exporters and freight forwarders turn to CIP (Carriage and Insurance Paid to) when they need to provide the buyer with both prepaid freight and a guaranteed minimum insurance cover to the named destination. Risk transfers to the buyer at the moment the goods are handed to the first carrier at the place of dispatch—yet the seller remains liable for freight charges and the insurance premium throughout. CIP differs from CPT (Carriage Paid To) solely by this insurance obligation: under Incoterms 2020, the minimum standard was raised to ICC Clause A, offering broad all-risks coverage rather than the narrower Clause C protection that applied previously. The term works across all modes of transport and is widely used in air freight and multimodal shipments involving high-value cargo. Buyers who require coverage beyond the contractual minimum should specify the extended scope explicitly in the sale contract.

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