In plain English
Risk passes to the buyer at the first handover, as with CPT, but the seller pays for both the transport and an insurance policy that protects the buyer on the way. Incoterms 2020 raised the required cover for CIP to the wider all-risks level (Institute Cargo Clauses A), unlike CIF, which still requires only the minimum.
Why it matters when you ship
For manufactured goods that move by truck, air or container, CIP gives the buyer meaningful insurance without extra paperwork. Check the policy limits against the value of the goods.
Example
“CIP Toronto” on a quote means the price covers freight to Toronto and an insurance policy for the buyer. If the pallets are damaged in transit, the buyer claims on the seller’s policy.
Related terms
CIP (Carriage and Insurance Paid To): common questions
What does CIP cover?
Under Incoterms 2020, an insurance policy with wide all-risks cover for at least the contract price plus 10 percent, in the contract currency, naming the buyer as beneficiary.
Cite this page
Cite as: Transportli, “CIP: Carriage and Insurance Paid To Meaning”, https://transportli.com/glossary/cip/, updated November 11, 2026.
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