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TeachMeFinance.com - explain Cost, insurance and freight historic definition... Cost, insurance and freight -- The letters "c. i. f." in a contract of sale of merchandise stand for the words "cost, insurance, freight" and they mean that the price agreed upon is all that the buyer is to be required to pay for the goods themselves, for their transportation to destination and for their insurance while in transit. , The seller furnishes the goods, pays the insurance on them, pays the freight on them, delivers the merchandise to the carrier and forwards the bill of lading to the buyer. His duty is then discharged. The carrier is an agent of the buyer and delivery to the carrier is equivalent to delivery to the buyer. The seller is entitled to the amount named in his contract whether the goods reach the buyer or not. For loss or damage while in transit the buyer must look exclusively to the carrier or the insurer. About the author Mark McCracken Author: Mark McCracken is a corporate trainer and author living in Higashi Osaka, Japan. He is the author of thousands of online articles as well as the Business English textbook, "25 Business Skills in English". Copyright © 2007 by Mark McCracken, All Rights Reserved. TeachMeFinance.com is an informational website, and should not be used as a substitute for professional financial or legal advice. TeachMeFinance.com and its owner recommend consultation with a professional financial advisor prior to any investment or financial decision. Please read our disclaimer. .html