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Protecting your vehicle with the right insurance is essential, especially for car owners who want to maintain their vehicle's value in the long run. There are two main options: Total Loss Only (TLO) Insurance, which covers damage exceeding 75% of the car’s value or total loss, and Comprehensive (All Risk) Insurance, which covers all types of damage along with additional protection. Choosing the right insurance is an important step for car owners.
Car insurance is a type of financial protection provided to vehicle owners to cover losses or damages that may occur. This protection includes risks such as accidents, theft, damage caused by natural disasters, fires, and even minor damages like scratches or dents. Additionally, vehicle owners can opt for extended coverage, such as protection against floods, riots, and third-party legal liability. Having car insurance means you don’t have to worry about unexpected repair or replacement costs. There are two types of car insurance you should consider: Total Loss Only (TLO) and Comprehensive (All Risk) Insurance.
1. Type of Vehicle: New/Luxury vs. Old/Low Value
Choose Comprehensive car insurance for maximum protection if your car is new or luxury.
TLO can be a more economical option if your car is older or has a lower resale value.
2. Usage Location: High-Risk Accident or Crime Areas
Choose Comprehensive car insurance with additional coverage if you live in an area prone to floods or high crime rates.
Choose TLO if you are in a low-traffic area with minimal accident risk.
3. Budget: Extensive Protection vs. Cost Savings
Choose All Comprehensive car insurance if you have a higher budget and want extensive protection.
Choose TLO if you want to save costs while still having basic protection.
4. Ease of Claim Process: Comprehensive vs. TLO
Comprehensive car insurance: Easier to claim for various types of damages, including minor ones.
TLO: Only claimable if the damage exceeds 75% of the vehicle’s value or if the car is stolen.
Eka chose Comprehensive insurance because he frequently drives in Jakarta’s heavy traffic, while Dwi opted for TLO as his car was older. When Eka had a minor accident, he only paid IDR 300,000 out of pocket as the rest was covered by comprehensive insurance. In contrast, Dwi had to pay for repairs himself because TLO does not cover minor damages. However, when Dwi’s car suffered major damage exceeding 75%, he received full compensation.
Total Loss Only (TLO) Insurance provides coverage only if a vehicle experiences total damage—when repair costs exceed 75% of its market value—or if the vehicle is stolen.
TLO insurance covers damages or losses that qualify as total loss. Here’s what it includes:
Total Loss Due to Accidents: Coverage applies when repair costs exceed 75% of the vehicle's market value at the time of the claim.
Theft or Vehicle Loss: Compensation is provided if the vehicle is stolen or forcefully taken.
Fire Damage: Covers loss or damage caused by fire, whether due to accidents or incidents like explosions.
Natural Disasters & Riots (Optional Add-ons): Some TLO policies offer additional coverage for floods, earthquakes, and civil disturbances for an extra premium.
However, TLO insurance does not cover minor damages such as scratches, dents, or broken side mirrors. For example, if a car suffers a minor fender-bender, the owner must pay for the repairs themselves. On the other hand, if the car is stolen, the insurance company will compensate based on its market value at the time of the claim.
Since TLO is designed for major losses, it is typically best suited for older vehicles (10+ years old) or cars with a lower resale value.
Comprehensive car insurance, also known as All Risk insurance, offers broader protection compared to Total Loss Only (TLO) insurance. In addition to covering total loss, it also protects against all types of damage, including minor damages such as scratches, broken mirrors, and dents. In this case, "Comprehensive" means covering any potential risks to your vehicle, whether physical damage or financial loss.
Comprehensive insurance also covers vehicle theft and fire damage. Additionally, some insurance providers offer extra benefits, such as routine maintenance costs and coverage for third-party liability in case of an accident. Although Comprehensive insurance comes with a higher premium compared to TLO, it provides much more extensive coverage. Policyholders can also customize their plans with additional protections, such as flood insurance or a replacement car service while their vehicle is under repair.
Comprehensive insurance covers a wide range of risks, including:
According to the Financial Services Authority (OJK), vehicle owners in high-accident areas are advised to choose Comprehensive insurance to minimize financial risks from unexpected incidents. Source: OJK
A report from the General Insurance Association of Indonesia (AAUI) states that insurance claims in Q1 2024 reached IDR 11.3 trillion, a 14.5% increase from the previous year. Additionally, AAUI data recorded that in 2022, claims for motor vehicle insurance payments totaled IDR 6.49 trillion, up 10.2% from the previous year.
Car insurance doesn’t just cover basic risks—it can also be expanded with additional benefits, including:
By customizing your coverage with these additional protections, you can maximize the benefits of your car insurance. When choosing a policy, always review the coverage details to ensure they align with your needs.
Comprehensive car insurance provides several key advantages for vehicle owners. Here’s why it’s worth considering:
One of the biggest advantages of Comprehensive insurance is its extensive coverage. You don’t have to worry about accidents, theft, or fire damage, as all of these risks are included in the policy. This offers greater peace of mind, knowing your car is well-protected in various situations.
If your car sustains major damage or is stolen, Comprehensive insurance protects you from unexpected financial burdens. The policy covers repair costs or vehicle replacement, ensuring you don’t have to pay out-of-pocket for costly repairs.
Comprehensive insurance helps preserve your vehicle’s value by covering significant repairs and replacements. This prevents steep depreciation and helps maintain the car’s resale price over time.
In the long run, Comprehensive insurance offers strong financial protection, peace of mind, and a safety net against unexpected incidents.
Deciding whether to get car insurance—and which type—is an important financial decision. Here are some situations where Comprehensive insurance is the best option:
If you own a brand-new or luxury vehicle, Comprehensive insurance is highly recommended. High-value cars are often targets for theft and can incur expensive repair costs due to their advanced features. This policy helps protect your investment against financial losses.
If you reside or frequently drive in areas with high crime rates, the risk of theft, vandalism, or car break-ins increases. Comprehensive insurance provides financial protection against these risks, ensuring you won’t have to cover losses on your own.
For those who commute long distances or drive in heavily congested cities, the likelihood of accidents and collisions is higher. With Comprehensive insurance, your vehicle is covered for both major and minor damages, reducing unexpected financial burdens.
Regardless of your car’s age, having Comprehensive insurance ensures that you’re protected against unforeseen incidents. Knowing your vehicle is insured against various risks provides a sense of security and financial stability.
Ultimately, deciding between Comprehensive and TLO insurance depends on your individual circumstances, driving habits, and budget. Carefully assess your needs and consult with your insurance provider to find the best policy that safeguards your vehicle and finances.
Choosing the right car insurance isn’t just about affordability—it’s about comprehensive protection for your vehicle in every journey. Oona Insurance offers more than just standard coverage. With flexible options between TLO and Comprehensive insurance, Oona provides customized protection tailored to your needs.
With 24/7 emergency assistance, a trusted repair network, and a seamless claims process, Oona makes car insurance simple and hassle-free. It’s time to choose coverage that truly works for you—Oona Insurance is the answer.
As a leading car insurance provider, Oona stands out by offering extensive coverage and premium services. Here’s why Oona is the preferred choice:
Selecting the right car insurance depends on your vehicle’s condition, risk factors, and financial plan. If you need full protection against all risks, Comprehensive insurance is the best choice. However, if you have an older vehicle and want cost-effective coverage, TLO insurance is a practical option.
Before making a decision, read your policy carefully to understand the coverage, exclusions, and additional benefits. Choosing the right insurance will protect your car and finances from unexpected expenses.
Don’t wait for an accident to happen! Ensure your car is protected with the right insurance. Compare and find the best car insurance plans from Oona today!
