Letter of Indemnity :-
In order to get a "clean " bill of lading , the shipper may often try to persuade the carrier or his agents not to make any reservation on the bill of lading , which he would have otherwise made and accept , instead a letter of indemnity . Such letter of indemnity would seek to indemnify the carrier against all consequences arising out of the issue of a "clean" bill of lading . But such a letter of indemnity would not be valid in law and on the other hand is considered to be fraudulent . It would not be accepted by courts and the carrier will have no legal right to proceed against the shipper .
An indemnity is a sum paid by A to B by way of compensation for a particular loss suffered by B. The indemnitor (A) may or may not be responsible for the loss suffered by the indemnitee (B). Forms of indemnity include cash payments, repairs, replacement, and reinstatement.
Indemnity insurance compensates the beneficiaries of the policies for their actual economic losses, up to the limiting amount of the insurance policy. It generally requires the insured to prove the amount of its loss before it can recover. Recovery is limited to the amount of the provable loss even if the face amount of the policy is higher. This is in contrast to, for example, life insurance, where the amount of the beneficiary's economic loss is irrelevant. The death of the person whose life is insured for reasons not excluded from the policy obligate the insurer to pay the entire policy amount to the beneficiary.
Most business interruption insurance policies contain an Extended Period of Indemnity Endorsement, which extends coverage beyond the time that it takes to physically restore the property. This provision covers additional expenses that allow the business to return to prosperity and help the business restore revenues to pre-loss levels.
Lien :-
Lien means shipowner's right to retain procession of the goods carried on board as security for payments of freight and other certain charges .
A shipowner has by common low on lien on the goods carried for
A) Freight
B) General Average Contributions
C) Salvage Expenditure .
