CIF vs FOB: which price should you ask for?
What each term covers, who pays for insurance, and when FOB is the cheaper choice for your country.
When you buy a car from Dubai for delivery abroad, the first price you see usually has three letters after it. Those letters decide who pays for the ship, who pays for insurance, and where the risk passes to you.
What CIF means
CIF stands for Cost, Insurance and Freight. The price includes the car, the sea freight to your port, and marine insurance until the ship arrives. You pay one figure, and we book the vessel.
- We choose the shipping line and sailing date.
- The car is insured against damage and loss at sea.
- You handle customs clearance and duties at your port.
What FOB means
FOB, Free On Board, covers the car until it is loaded at Jebel Ali. From that moment the freight, the insurance and the risk are yours. It suits buyers who already work with a clearing agent or a freight forwarder.
“For first-time buyers we almost always recommend CIF. One price, one contact, and the insurance is already arranged.”
Sara Malik, Head of export
Side by side
| CIF | FOB | |
|---|---|---|
| Car price | Included | Included |
| Sea freight | Included | You arrange |
| Marine insurance | Included | You arrange |
| Risk passes to you | At your port | At Jebel Ali |
| Best for | First-time importers | Traders with a forwarder |
Which one to choose
Choose CIF if this is your first import, if you want one invoice, or if your bank asks for an insured shipment. Choose FOB if you ship several cars a month and already have better freight rates than a retail buyer can get.
Either way, ask for the price in writing with the port name, the sailing month and the shipping method (RoRo or container).
Sara Malik
Sara has run the Sabra export desk since 2015 and has shipped cars to more than 40 countries. She writes about paperwork so you don't have to.
3 comments
This cleared up a lot for me. My clearing agent in Mombasa wanted FOB, now I understand why.
Glad it helped, Daniel. If your agent has a good freight rate, FOB can save you a few hundred dollars.
Does the CIF price change if the sailing is delayed?