For those of you who have bought a new car, you will definitely be offered the best type of car insurance, TLO or all risk (comprehensive) insurance. It's important for prospective insurance participants to know what TLO and all risk insurance are, so there's no misunderstanding.
Sometimes there are still people who can't tell the difference between TLO insurance and all risk insurance. However, the two are not the same. Well, understanding the difference between these two insurances is also important so that you can choose the right insurance product for your vehicle.
TLO Insurance is Total Loss Only Insurance, what is it?
There is indeed a slight difference between TLO and all risk insurance.The definition of TLO insurance is insurance that covers the cost of repairing cars with total damage above 75 percent.
While the definition of all risk insurance is insurance that covers the cost of repairing a car due to minor or major damage.This means that the coverage of protection provided by all risk insurance known as comprehensive is indeed greater than Total Loss Only insurance.
In short, TLO car insurance is insurance that provides a guarantee for reimbursement of costs if your vehicle is lost or damaged with damage conditions above 75 percent. For example, if your vehicle hits the pavement and causes damage to the bumper of the car, you cannot claim using Total Loss Only insurance.
Because the damage that occurs is only a small part of the damage. Such damage can only be claimed if your vehicle is insured using all risk or comprehensive insurance. Another example, if your car is parked while you are walking at the mall, then your car is lost, then you can make a claim using Total Loss Only insurance.
Why is TLO Insurance More Recommended Than All Risk Insurance?
One of the reasons why this insurance is more recommended than all risk insurance is because the premiums paid are much cheaper.
That is, if you want to save expenses, Total Loss Only insurance is recommended compared to all risk insurance. TLO insurance is recommended for used vehicles under 10 years of age. For example, you can buy a used car from 2015 to 2019. This means that the used car is still eligible to be insured using TLO vehicle insurance.
While all risk or comprehensive insurance is more recommended for new vehicles. Of course this is done as an effort to provide a sense of security and comfort when driving. No one will ever know if your vehicle has an accident, theft or fire on the highway while in use. Some of these disasters may indeed not be your fault, but because of someone else's fault.
How to Claim TLO Insurance
To submit a Total Loss Only insurance claim, you have to go through several steps as below.
- Report claim
- Prepare documents
- Check partner workshop
- Complete the claim form
- Waiting for confirmation
1. Report a claim
Report the loss suffered within 5 working days of the loss. Claims reporting can be done through: Call the call center of the car insurance company of your choice. Report via the online application provided.
2. Prepare documents
Prepare insurance documents according to the product.Include a claim form according to the product that has been filled in. Immediately submit insurance documents and claim forms to the insurance company via email or facsimile. Photographs taken shortly after the incident showing the losses suffered.
3. Check partner workshops
Go to a repair shop that is registered as the nearest insurance partner. You can find out in the online application of the insurance of your choice or contact the call center.
4. Complete the claim form
Fill in the auto insurance claim form available at the repair shop. Once signed and stamped, attach other requirements.
5. Waiting for confirmation
The workshop will confirm with the insurance company. If the claim submission is approved, your car will be repaired immediately. Specifically for handling claims for cases of lost or stolen cars, the following are the steps.
- After a loss occurs, immediately report the case to the police.
- Make a written chronology of cases of lost vehicles.
- Bring all requirements such as ID Card insurance policy and loss report to the insurance office.
- File a claim.
Tips so that TLO insurance is not rejected
Often the claims that you submit to the insurance company get rejected. This is due to several things that you did not fulfill before.
So, make sure you do the things below so that your claim is not rejected. Car insurance claims must be taken care of immediately because the time limit is short, only 3 x 24 hours. Complete the driver's documents starting from a photocopy of the insurance policy, police certificate, photocopy of drive licensed, photo proof of the incident and of course a claim submission form.
Make sure not to violate the law such as violating traffic, not having a driver's license and others. Pay attention to the area of the accident that must be in accordance with the area clause in the agreement.If the car is modified, please report to the insurance company attaching the coverage value of the accessory.
Avoid things such as intentionally damaging the vehicle such as crashing his car into another car or hitting his vehicle so that it dents into a flood which can cause the car to break down due to the engine experiencing water hammer.
Make sure the insurance policy is still active.
Can All Risk and TLO Insurance be Combined?
To get the benefits of the two insurances above, you can actually take advantage of combination car insurance. Yes, it is possible if the two insurances are combined so that you get more benefits.
The way that can be done is for example by insuring the car with all risk insurance in the first year or second year. In the third year, you insure your car again with Total Loss Only insurance.
This takes into account the cost of new car damage which is higher in value even if the damage is small. As your car ages, you can provide protection for car repair costs with Total Loss Only insurance.
The Difference Between All Risk and TLO
From the initial explanation, it came to mind that TLO insurance is a 'bear' coverage. Bear the risk because the ownership of the vehicle is not only lost because it was stolen or destroyed in a fatal accident, but other minor risks.
There are opportunities for vehicle damage due to the negligence of oneself or others of a minor nature, such as body dents or scratches. In addition, the choice to fall on All Risk insurance is usually due to a recommendation from a vehicle salesperson or an insurance agent.
Oh yes, All Risk insurance is a type of coverage that covers losses for major or minor vehicle damage, other people's evil deeds, and stolen vehicles. It can even be expanded with riot guarantees, natural disasters, third party guarantees, and others.
Because the risks covered by TLO are narrower, many think about taking All Risk insurance. Consequently, the money that must be paid for insurance premiums is definitely higher.
But it should be emphasized that the main focus is not on being able to pay insurance premiums or not, but measuring the risk to the vehicle.
Sometimes people forget to consider this. What risks await your favorite vehicle when it is used ? The decision comes back to you.
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