FOB vs CIF: who pays for what, and where risk transfers.
FOB (Free On Board) and CIF (Cost, Insurance and Freight) are two of the most common Incoterms 2020 rules for ocean shipping. They differ in just one place — who arranges and pays for the main sea freight and cargo insurance. Use the table to see the full cost split, then the calculator to convert between an FOB and a CIF price.
Jump to the calculator ↓Cost & responsibility allocation
| Cost element | FOB | CIF |
|---|---|---|
| Export packing & marking | Seller | Seller |
| Inland haulage to origin port | Seller | Seller |
| Export customs clearance & formalities | Seller | Seller |
| Origin terminal handling (THC) | Seller | Seller |
| Loading on board the vessel | Seller | Seller |
| Ocean freight (main carriage) | Buyer | Seller |
| Marine cargo insurance in transit | Buyer | Seller |
| Destination terminal handling (THC) | Buyer | Buyer |
| Import customs clearance, duties & taxes | Buyer | Buyer |
| Unloading & inland delivery to final destination | Buyer | Buyer |
Only the highlighted rows differ between FOB and CIF.
Where does risk transfer?
Under Incoterms 2020, risk passes from seller to buyer at the same point for both FOB and CIF — when the goods are loaded on board the vessel at the origin port. Under CIF the seller pays freight and insurance to the destination port, but the buyer already carries the risk during the sea voyage; the seller-arranged insurance is what covers the buyer through that leg.
Convert FOB ↔ CIF
Enter every figure in the same currency.
Marine insurance is commonly arranged at 110% of the CIF value (CIF price plus a 10% margin). Enter your actual premium here.
This calculator performs simple arithmetic on the figures you enter. It does not provide live freight, insurance or duty rates, and it is not legal or contractual advice. Always confirm Incoterms and costs with your freight forwarder before contracting.
