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what is the meaning of CIF or CIP Value
Posted: Wed Jul 22, 2009 4:45 pm
by jim
Dear Sir,
UCp 600 article 28 f suggest to calculate the insurance coverage based on CIF or CIP value. at the same time it mentions the gross value of invoice. please explain me the CIF value and how it is different from an invoice which shows the value of the goods including insurance cost.
Value of insured goods
Posted: Thu Jul 23, 2009 2:23 am
by picant
Hi Pal,
CIF-Cost Insurance and freight or CIP Carriage and insurance paid to, are incoterms, or terms of delivery, normally followed by a Place at destination. Insurance premium and subsequent cover are determinated by CIF / CIP price - 10% of foreseen added value. Sometime it is no possible to have a proper value of the goods at destination so the insurance cover will be calculated as per art 28 f, ii. Remember that no insurance will pay a claim more that the commercial value at destination of the damaged goods.
Other comments appreciated
Ciao
How CIF works! ...I think!
Posted: Wed Dec 30, 2009 7:27 pm
by bwpotman
Hi, CIF is the cost of the goods (Invoice value) + Freight charges + insurance premium. The insurance premium itself is based on the C and F parts of the incoterm with an uplift of 10%, so if the invoice value is 10000 GBP, the cost of freight is 500GBP, the total to be insyred is 10500 GBP X 1.1 = 11550 GBP. Insurance rates are based on a pence percent rate, such as 0.65% (so many pence per 100 GBP of cover,example only!) which would make the premium 75.08 GBP. In this example the CIF value would be 10575.08 GBP.
Hope this helps.... and hope i was accurate!