The CIP Incoterm or “Carriage and Insurance Paid to” states that the seller is responsible for bringing the goods to the destination, the cost of international freight, as well as insurance costs.
Under CIP, the Incoterms risk transfer point is different from the cost transfer point. The CIP risk transfer takes place when the goods have been accepted by the shipping carrier, be it at the terminal or port, and is a recommended Incoterm for containerized cargo.
The CIP Incoterm is versatile as it can be used for intermodal transportation.
If, as a buyer, you are able to obtain better or cheaper insurance, consider opting for CPT instead, under which the seller is not contractually obliged to provide cargo insurance and you, as a buyer, can obtain your preferred insurance policy.
"The problem with these costs is that they’re often impossible to predict and are thus hardly ever considered when analyzing and comparing ocean freight rates"
Klaus Lydsal, vice president of operations at iContainers