total loss only
Also called: TLO
A type of vehicle coverage that pays only if damage is very severe or the vehicle is lost.
What it means
Total loss only or TLO is a type of vehicle insurance protection that covers losses only if the vehicle suffers severe damage or is totally lost. Minor to moderate damage is usually not covered, even if the cost is fairly large. Because its scope is narrower, the premium is generally cheaper than all risk. The policy sets the damage threshold considered a total loss, for example a certain percentage of the vehicle's value.
Why it matters for families
TLO suits lower-value vehicles or families with a limited premium budget, because it focuses on major risks. However, misunderstanding can make families think small scratches or dents can be claimed, when they cannot. As a result, minor repair costs still have to come out of their own pocket. Understand the total loss threshold in the policy before choosing.
Example
For example, a motorcycle worth Rp20 million is insured with TLO at a cheaper annual premium than all risk. If the motorcycle is stolen, a claim can be filed according to the insured value. But if only a mirror breaks or the body is slightly dented, the repair cost is borne by yourself because it doesn't meet the total loss criteria.
Common misunderstanding
Many think TLO guarantees all damage as long as there is an accident. In fact, TLO covers only severe damage or total loss according to the threshold in the policy.