Letter of Indemnity and Cargo Claims

Are you familiar with the term “Letter of Indemnity” (LOI)? If you’re involved in exporting goods, chances are you’ve encountered this document at some point. Shipping lines often request exporters to sign an LOI, but before you grab that pen, I’ll tell you why you should think twice.

What’s the Deal with LOIs?

Picture this: your cargo is loaded onto a vessel, and suddenly, you receive a request to sign an LOI from the shipping line. They claim they won’t issue the Bill of Lading (BL) unless you comply. Some carriers even have pre-drafted LOIs for specific commodities like onions or hazelnuts.

But here’s the catch – carriers’ LOIs are designed in a way that might make you waive your rights to submit a claim. Unless you’ve lost the Original Bill of Lading (OBL) or have rare circumstances like the need to sample cargo in transit, the carrier typically has no right to insist on an LOI or limit their responsibility for your cargo.

Can You Refuse to Sign?

Absolutely. Here’s why you should seriously consider saying no to signing an LOI:

1. Protect Your Claims

Cargo damage is a genuine concern in the shipping industry. It’s your right to seek compensation if your cargo arrives damaged or doesn’t reach its destination in the promised condition. Signing an LOI might slam the door shut on your claim recovery efforts, leaving you with no recourse.

2. Legal Safeguards

Signing an LOI without fully understanding its implications could strip you of important legal protections. What may seem like a straightforward document may have hidden consequences? Don’t let a rushed decision cost you more in the long run.

3. Expert Assistance

Instead of giving in to pressure and signing an LOI, consider reaching out to experts who specialize in cargo claim recovery. These professionals are well-versed in the intricacies of the industry and can guide you through the process without compromising your rights.

Don’t let the pressure of an LOI push you into a corner in particular when shipping lines have no right to ask you for this document. 

Recoupex is a hub of transport lawyers – experts in cargo claims. We assess your case quickly. We have successfully recovered claims from Maersk, Sealand, Hapag-Lloyd, Mediterranean Shipping Company – MSC, CMA CGM, and other carriers.

SUBMIT A CLAIM NOW!