LOI

LOI is the shorthand for a letter of indemnity, a written undertaking to indemnify a party for acting against the strict documentary position. The classic use is asking a carrier to deliver cargo without the original bill of lading, common in oil and commodity trades where the goods outrun the documents. A second use is asking the carrier to issue a clean bill of lading against goods that would otherwise be claused. An LOI is a contractual promise whose value depends on the giver’s covenant, so carriers usually require bank countersignature; delivery without the bill voids P&I cover.