Incoterms and freight quotes: who is responsible?

An agreed Incoterm allocates costs, risk and tasks between buyer and seller; it does not itself set a freight price or transfer title. Record the rule, named place and agreed version (for example Incoterms 2020). Check separately who arranges import clearance and pays VAT or duties, and whether the quotation includes waiting, last-mile delivery, handling or insurance.

What an Incoterm actually does

The agreed rule allocates transfer of risk, some transport tasks and some costs between seller and buyer. Always state the rule, its named place and agreed version of Incoterms. 'FCA Monaco' without an exact handover location leaves an important detail open. An Incoterm alone does not transfer title, classify the goods or supply blanket insurance. For multimodal movements, check that the rule is appropriate to the journey; some rules are intended only for sea or inland waterway transport. Tell the freight planner who will make the goods available and where physical handover takes place.

Compare quotations with matching scope

Separate collection, origin handling, main carriage, terminal charges, customs representation, destination fees and final delivery. A price to a port is not a price to your customer's premises. Declare chargeable weight, whether pallets are non-stackable and any need for a tail lift: without those details, two apparent alternatives may cover different services. Import VAT and customs duty are separate from the agent's fees. Unplanned storage or an examination may create further charges under the agreed terms. Ask whether loading, unloading and booking a delivery slot are included at both ends.

Decide before booking

Confirm who is importer and whether that party has the necessary destination-country registration. Some proposed delivered-duty-paid transactions may be impracticable if the seller cannot comply with local import requirements. Agree who loads, who unloads and who takes out cargo cover if the goods' value exceeds carrier liability. For a return, decide who retains the outward-shipment evidence. A useful quotation lists exclusions and the assumptions behind its delivery window rather than just a total. Seek the actual cover wording if valuable or fragile goods are involved; declared value alone is not an insurance contract.

Checks for this scenario

DAP and DDP allocate import responsibilities differently: check that the party expected to clear goods can actually act in the destination country. 'Freight included' says nothing about terminal, inspection or waiting charges. Put exact addresses, loading and unloading operations, pallet count and payment terms in the offer. Review carrier liability limits separately from any optional insurance before comparing rates. A lower door-to-port price can cost more than a transparent door-to-door quotation once destination charges are added.

For example, a quotation using DAP to the buyer's premises can leave import duty and import VAT with the buyer even when the seller paid for the main transport. Ask where risk passes and whether a failed delivery because the consignee could not clear the goods will incur a second charge. Compare that outcome against the agreed price, not against a shorthand label on the sales invoice.

Cargo insurance and carrier liability

The carrier's legal liability may be capped under the applicable transport regime and need not match the goods' commercial value. Describe the item, substantiated value, route, mode and packing when requesting a cover review.

Clarify whether handling, interim storage or multimodal legs should be covered. Obtain written terms, deductible, exclusions and claims procedure. At delivery record specific damage reservations, retain the packaging and photographs and promptly notify the parties named in the contract.

FAQ

Is insurance automatic?

No. Cover needs explicit confirmation of terms and price separately from the transport rate.