Cost, Insurance and Freight" means that the seller delivers when the goods have been placed on the ship at the port of shipment.
The seller must pay the costs and freight necessary to bring the goods to the named port of destination but the risk of loss or damages to the goods, as well as any additional costs due to events occurring after the time of delivery, are transferred from the seller to the buyer. However, in CIF, the seller also has to procure marine insurance against the buyer's risk of loss of or damage to the goods during the carriage.
Consequently, the seller contracts for insurance and pays the insurance premium. The buyer should note that under the CIF term, the seller is required to obtain insurance only on minimum coverage. Should the buyer wish to have the protection of greater coverage, he would either need to agree as much expressly with the seller or to make his own extra insurance arrangements.
Traders are allowed to use the standard rate provided by Customs for freight and insurance to compute the CIF value of imported cargo when the actual charges are not available.