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All risk car insurance helps protect vehicles from minor damage to total loss, in accordance with the policy provisions. This article discusses the definition, benefits, differences from TLO, coverage that needs attention, how to calculate premiums based on OJK rates, and claim steps so that you can choose protection that suits your needs.
The risk of car damage in Indonesia cannot be viewed as a small possibility. Data from the Ministry of Transportation, based on synchronized agency data, records that the total number of motor vehicles in Indonesia has reached around 166.4 million units, including a population of more than 20.4 million passenger cars. Detailed periodic distribution of road vehicle fleets can be monitored in detail in the BPS document sheet on the Development of the Number of Motor Vehicles by Type. With this volume of vehicles, the risk of collisions, minor damage, loss, and repair costs becomes an important consideration for car owners.
Road risks are also reflected in traffic accident figures. The Indonesian National Police Traffic Corps recorded 79,220 traffic accidents up to August 5, 2024, a statistic recorded in the Indonesian National Police Traffic Corps Traffic Accident Data. Data from the National Criminal Information Center of the Indonesian National Police Criminal Investigation Agency also shows that 118,452 traffic accidents occurred from January 1 to November 4, 2024, with more than 1.2 million vehicles involved in accidents throughout that period, as released in the Indonesian National Police National Criminal Information Center Accident Statistics Report.
In conditions like this, all risk car insurance can be one way to help reduce financial risk due to vehicle damage. This protection is generally broader than TLO because it can cover partial damage, such as scratches, dents, or minor collisions, up to total loss and vehicle theft, in accordance with the policy provisions. However, the term “all risk” does not mean that all risks are automatically covered. Several protections such as floods, earthquakes, riots, third-party liability, and personal accident usually require additional coverage extensions. OJK also divides motor vehicle premium rates based on the vehicle’s area of use, namely region 1, region 2, and region 3, so the vehicle’s location also affects premium costs based on the official rules in the OJK Motor Vehicle Premium Rate Circular Letter.
This article helps you understand how all risk car insurance works in a more practical way, starting from benefits, coverage, exclusions, differences from TLO, factors that affect premiums, to claim steps that need to be understood before buying a policy.
Before comparing the benefits, premiums, or claim process, it is important to first understand what is meant by all risk car insurance and how this protection works in a vehicle policy.
All risk car insurance is a type of motor vehicle insurance that provides protection against partial damage as well as total loss of the vehicle, in accordance with the policy provisions.
In practice, all risk insurance is also often referred to as comprehensive car insurance. This protection can cover minor damage such as scratches, dents, or damage caused by minor collisions, up to major losses such as a vehicle being lost due to theft or experiencing severe damage.
Although it is called all risk, this does not mean that all risks are automatically covered. Several risks such as floods, earthquakes, riots, third-party liability, or personal accident usually require additional coverage extensions. Therefore, it is important to read the policy completely before buying.
After understanding its definition, the next step is to see why this type of protection is relevant for car owners, especially when vehicle repair costs and road risks can have a direct impact on financial conditions.
A car is a high-value asset. Vehicle repair costs, especially for new cars, family cars, premium cars, or cars with complex electronic components, can become a large financial burden if they must be borne personally.
All risk car insurance can help provide financial protection when the vehicle experiences risks that are guaranteed in the policy. This protection is relevant for vehicle owners who use their cars every day, live in cities with dense traffic, or want to reduce the risk of large expenses due to vehicle damage.
In general, all risk insurance is suitable for:
New cars or vehicles that still have high value
Cars used every day
Vehicle owners who often drive in crowded areas
Car owners who want protection against minor and severe damage
Vehicle owners who want access to partner workshops when making a claim
If you are still comparing types of vehicle protection, you can also read the guide on the differences between TLO and all risk insurance to make it easier to determine your choice.
The benefits of all risk car insurance will be easier to understand if you know which risks are generally included in the policy coverage and which risks usually require additional coverage extensions.
All risk car insurance coverage can differ between insurance companies and depends on the policy chosen. However, in general, all risk protection can cover partial damage, total loss, and vehicle loss due to certain risks.
Type of Risk |
Generally Covered by All Risk? |
Explanation |
|---|---|---|
Damage Due to Collision |
Yes |
Includes minor or severe collisions, in accordance with the policy provisions |
Scratches, Scuffs, |
Yes |
Includes minor |
Vehicle Loss Due |
Yes |
Compensation follows the policy provisions and sum insured |
Damage Due |
Yes |
According to the cause |
Damage Due |
Requires extension |
Usually requires a flood coverage extension |
Damage Due to Earthquake or Tsunami |
Requires extension |
Usually requires a natural disaster extension |
Damage Due |
Requires extension |
Usually requires an SRCC extension |
Third-Party Legal Liability |
Requires extension |
Usually requires |
Driver or Passenger Personal Accident |
Requires extension |
Usually available |
Damage Due |
No |
Generally excluded |
Damage Due |
No |
Generally excluded |
Dislaimer: Coverage can differ between insurance companies. Coverage extensions usually require additional premiums. Make sure you read the policy, product information summary, exclusions, and claim requirements before buying.
Although the coverage is broad, not all risks are automatically covered. Therefore, it is important to understand several common misunderstandings so that you do not make mistakes when reading policy benefits.
One of the biggest misunderstandings is the assumption that all risk insurance covers all risks. In fact, every policy has a list of exclusions that need attention.
For example, damage caused by flooding is not necessarily automatically covered if you do not take a flood extension. The same applies to riots, earthquakes, personal accidents, or third-party liability. These protections may be available, but they usually need to be added as extensions.
Another misunderstanding is assuming that the sum insured is always the same as the vehicle’s purchase price. In many cases, the sum insured follows the vehicle’s market value when the policy is issued or when a claim is made, in accordance with the policy provisions. Because a car’s value can depreciate, it is important to ensure that the sum insured still matches your vehicle’s condition.
After understanding the limits of all risk protection, a comparison with TLO can help you see the differences in function, coverage, and usage conditions of each type of car insurance.
All risk and TLO insurance have different functions. All risk provides broader protection because it can cover partial damage as well as total loss. Meanwhile, TLO or Total Loss Only only covers total loss, usually if the vehicle is severely damaged with a damage value reaching a certain limit according to the policy, or is lost due to theft.
To understand the comparison more completely, you can read the guide on the differences between all risk and TLO car insurance before choosing the type of protection that suits your vehicle’s needs.
Factor |
All Risk |
TLO |
|---|---|---|
Minor Damage Such as Scratches or Dents |
Covered according |
Not covered |
Partial Damage Due to Collision |
Covered according |
Not covered |
Severe Damage or Total Loss |
Covered according |
Covered according |
Loss Due to Theft |
Covered according |
Covered according |
Premium |
Higher |
Lower |
Suitable For |
New cars, high-value cars, daily vehicles |
Older cars or vehicle owners with limited premium budgets |
Protection Focus |
Minor to severe damage |
Total loss or loss |
Disclaimer: The comparison above is general. The definition of total loss, claim limits, exclusions, and benefits can differ depending on the policy chosen.
The difference in coverage between all risk and TLO also affects premium costs. Because all risk protection is broader, it is important to understand how the basic premium is calculated before comparing policy options.
All risk car insurance premiums are influenced by several factors, such as the vehicle’s sum insured, area of use, vehicle category, vehicle age, type of use, and selected coverage extensions.
In general, car insurance premium calculations refer to motor vehicle insurance rates regulated by OJK. The basic premium estimate can be calculated using the following formula.
Premium = Premium Rate x Vehicle Sum Insured
For example, if the vehicle’s sum insured is Rp300 million and the applicable premium rate is 2.5%, then the estimated basic premium is as follows.
Rp300,000,000 x 2.5% = Rp7,500,000 per year
This figure is an estimated basic premium. The final cost paid may differ because it does not include administration fees, coverage extensions such as flood or third-party liability, deductible, discounts, taxes, or underwriting provisions from the insurance company.
The premium formula can provide an initial overview, but the final cost paid may differ. There are several additional factors that can affect the amount of all risk car insurance premiums.
All risk car insurance premiums are not determined by only one factor. Insurance companies usually assess the vehicle profile, area of use, type of protection, and coverage extensions before determining the final premium that needs to be paid.
Factor |
Impact on Premium |
|---|---|
Vehicle Sum Insured |
The higher the sum insured, the larger the nominal premium paid |
Vehicle Area of Use |
Premium rates may differ based on the area where the vehicle is used or registered |
Vehicle Age |
Older cars may have different coverage provisions, premiums, or age limits for coverage |
Type of Vehicle Use |
Private vehicles and commercial vehicles may have different rates and risk provisions |
Coverage Extensions |
Additional protection such as flood, earthquake, SRCC, TPL, and personal accident can increase the premium |
Claim History |
Some insurance companies may consider claim history when renewing a policy |
Partner Workshops and Claim Facilities |
Workshop networks, towing services, and claim facilities can affect the benefit value received by the policyholder |
Disclaimer: This table is a general guide. The actual premium is determined by the insurance company based on the vehicle profile, region, type of protection, benefit extensions, deductible, and applicable underwriting provisions.
In addition to vehicle and regional factors, coverage extensions can also affect the premium. The following section helps you understand what additional protections are commonly considered according to vehicle usage risks.
Not all additional protections are automatically included in a standard all risk policy. Therefore, vehicle owners need to review coverage extensions that are relevant to daily risks.
Some extensions that are commonly considered include:
Flood
Earthquake and tsunami
Riots, strikes, civil commotion, and civil unrest
Third-party legal liability
Driver personal accident
Passenger personal accident
Emergency or towing services
Additional accessory protection, if available
If the vehicle is used in flood-prone areas or often passes through crowded areas, flood and third-party liability extensions can be important considerations.
After knowing the coverage and coverage extensions that can be selected, you also need to understand the claim process so that the protection can be used correctly when vehicle damage or loss occurs.
The all risk car insurance claim process needs to follow the insurance company’s procedures so that the application can be properly reviewed. In general, the following steps usually need to be taken when filing a claim.
Contact the insurance company immediately after damage, an accident, or vehicle loss occurs. Some companies have claim reporting time limits, so it is best to report as soon as possible after the incident.
Documents that are usually required include the insurance policy, driver’s license, vehicle registration certificate, personal identification, claim form, photos of the damage, and a police report if needed.
Take photos of the damage from several angles, including the affected parts of the vehicle and the surrounding conditions if relevant. This documentation helps the insurance company assess the vehicle’s initial condition.
The insurance company may appoint a surveyor to inspect the damage, verify the chronology of the incident, and determine the repair estimate in accordance with the policy provisions.
If the claim is approved, the vehicle is usually directed to a partner workshop for repair. Make sure you follow the insurance company’s instructions so the claim process runs according to procedure.
Some claims have a deductible that must be paid by the policyholder. The amount may differ depending on the type of claim and the policy provisions.
After the vehicle is repaired, check the repair results before receiving the vehicle back. Make sure the workshop’s work matches the damage approved in the claim.
To understand the process after an incident more completely, you can read the guide on car insurance claim steps after an accident.
Before buying a policy, use the following checklist to evaluate whether the benefits, costs, and services offered already match your vehicle’s needs.
Before buying all risk car insurance, use the following checklist so that the protection you choose suits your needs:
Check whether the policy covers partial damage and total loss
Make sure flood, earthquake, or riot risks are available as extensions if needed
Check the amount of deductible per incident
Compare premiums based on the vehicle’s sum insured
Review the list of partner workshops and their locations
Check whether towing or emergency assistance services are available
Ask about claim requirements and claim reporting time limits
Check whether third-party legal liability benefits are available
Make sure the insurance company is licensed and supervised by OJK
Do not choose only based on the cheapest premium, but also look at coverage and claim services
After knowing the things that need to be checked before buying a policy, the next question is whether all risk is the right choice for your vehicle’s condition and protection needs.
All risk car insurance can be a suitable choice if your vehicle is still new, has high value, or is used every day. This type of protection is also relevant if you want to reduce the risk of repair costs due to partial damage, such as scratches, dents, damage caused by minor collisions, or other risks guaranteed in the policy.
In general, all risk insurance is more suitable for car owners who prioritize broader protection over lower premiums. This protection can also be considered if you live or drive in areas with dense traffic, flood risks, or a higher possibility of vehicle damage.
Meanwhile, if the car is older or the vehicle’s value has decreased quite significantly, TLO insurance can be a more economical alternative. However, the decision still needs to be adjusted to the vehicle’s sum insured, usage risks, ability to pay premiums, coverage extensions needed, and the policy provisions offered.
If all risk insurance suits your vehicle’s needs, the next step is to compare the available protection options and ensure the policy benefits are easy to understand from the beginning.
Oona provides car insurance options that can help vehicle owners adjust protection to their needs and budget. Through the Oona Car Insurance product page, you can check protection options, understand the available benefits, and get an online premium estimate.
Before buying a policy, make sure you review the benefits, exclusions, coverage extensions, deductible, partner workshop network, and claim process. By understanding these details from the beginning, you can choose vehicle protection that better suits your needs.
Before making a decision, summarize your vehicle needs, the coverage required, the premium that fits your budget, and the policy provisions so that the protection choice truly supports the risks of using your car.
All risk car insurance can provide broader protection than TLO because it covers partial damage and total loss, in accordance with the policy terms and conditions. This type of protection is generally relevant for new cars, high-value vehicles, or cars used every day.
However, it is important to understand that the term all risk does not mean that all risks are automatically covered. Several risks such as floods, earthquakes, riots, third-party legal liability, and personal accidents usually require additional coverage extensions.
Before buying a policy, compare premiums, sum insured, deductible, partner workshop network, coverage extensions, and claim process. By understanding these details, you can choose car protection that suits your needs, budget, and vehicle usage risks.
