When you see CIP in your shipping documents, it means the seller is responsible for arranging and paying for the transportation and insurance of goods to a specified destination.
Seller’s Responsibilities with CIP:
When a seller uses CIP, they’re agreeing to:
- Transport Costs: Pay for the transportation of goods to a destination agreed upon with the buyer.
- Insurance: Secure insurance coverage for the goods during transit. This insurance must meet at least the minimum coverage specified under the terms.
- Export Duties: Handle any export duties or customs formalities in the seller’s country.
Buyer’s Responsibilities with CIP:
And what about the buyer? Here’s where they come in:
- Import Duties: Manage import duties and any customs clearance in their country.
- Additional Insurance: If the buyer wants extra insurance, they’ll have to arrange and pay for it.
- Risks: Once the goods are delivered to the carrier, the risk shifts from the seller to the buyer. So, it’s on the buyer to keep an eye on things from there!
Why Choose CIP?
You might be wondering why anyone would choose CIP over other Incoterms. Well, CIP offers a balanced approach to sharing responsibilities between buyers and sellers. Here’s why it rocks:
Simplicity and Assurance
CIP simplifies the shipping process by clearly defining who’s responsible for what. Plus, having insurance included is a nice safety net for both parties. It’s like having a buddy system for your goods!
Flexibility in Destination
With CIP, the seller agrees to transport the goods to a destination specified by the buyer. This flexibility can be a game-changer in global trade, allowing the buyer to choose the most convenient place for delivery.
