Which shipping arrangement requires payment on delivery and eliminates the right to inspect before payment?

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Study for the Chartered Property Casualty Underwriter 530 Exam with flashcards and multiple choice questions. Each question has hints and explanations to enhance your understanding and prepare you thoroughly.

Multiple Choice

Which shipping arrangement requires payment on delivery and eliminates the right to inspect before payment?

Explanation:
Collect on delivery is the arrangement where payment is due when the carrier delivers the goods, and the carrier does not release the shipment until payment is received. Because the release hinges on payment, the buyer cannot inspect the goods before paying. This directly matches the described scenario. The other terms relate to warranties or contract/claims vocabulary, not to payment timing or inspection rights, so they don’t fit the described shipping setup.

Collect on delivery is the arrangement where payment is due when the carrier delivers the goods, and the carrier does not release the shipment until payment is received. Because the release hinges on payment, the buyer cannot inspect the goods before paying. This directly matches the described scenario.

The other terms relate to warranties or contract/claims vocabulary, not to payment timing or inspection rights, so they don’t fit the described shipping setup.

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