It is simply a letter addressing to visa officer including subject and explanation. add few details about yourself too e.g. your name, application number, passport number etc.
There is no prescribed format. I would rather prefer typed than hand-written. You don't need to sign it or such. Its just an additional document which you are providing in order to support your application. Am sure every individual will have their own way of formatting.
I just had a title which is Letter Of Explanation, followed by the sub-title which would be the issue I want to address. I had one LOE, with multiple such sub-titles, one after the other. What matters is that you clearly explain with all relevant facts and evidence.