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As an Incoterm, CIF is broadly similar to the term CFR, with the exception that the seller is required to obtain insurance for the goods while in transit. CIF requires the seller to insure the goods for 110% of the contract value under Institute Cargo Clauses (A) of the Institute of London Underwriters (which is a change from Incoterms 2010 ...
FOB (free on board) is a term in international commercial law specifying at what point respective obligations, costs, and risk involved in the delivery of goods shift from the seller to the buyer under the Incoterms standard published by the International Chamber of Commerce. FOB is only used in non-containerized sea freight or inland waterway ...
The growth of mercantilism (which produced other financial innovations such as the charterparty or carta partita, the bill of exchange and the insurance policy [14]) produced a requirement for a title document that could be traded in much the same way as the goods themselves. It was this new avenue of trade that produced the bill of lading in ...
Cost, Insurance and Freight (CIF) The term "best way" generally implies that the shipper will choose the carrier that offers the lowest rate (to the shipper) for the shipment. In some cases, however, other factors, such as better insurance or faster transit time, will cause the shipper to choose an option other than the lowest bidder.
CIF – Cost Insurance With Freight; ... FOB – Freight On Board; ... For example, $225K would be understood to mean $225,000, and $3.6K would be understood to mean ...
If it is a destination contract (FOB (buyer's city)), then risk of loss is on the seller. If it is a delivery contract (standard, or FOB (seller's city)), then the risk of loss is on the buyer. In cases not covered by the foregoing rules, if the seller is a merchant, then the risk of loss shifts to the buyer upon buyer's "receipt" of the goods.
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The CISG describes when the risk passes from the seller to the buyer [48] but it has been observed that in practice most contracts define the seller's delivery obligations quite precisely by adopting an established shipment term, [41] such as FOB and CIF. [49] Remedies of the buyer and seller depend upon the character of a breach of the contract.