All Risk Car Insurance: Coverage, Premiums and TLO Compared

Is All Risk Car Insurance the Best Choice for You?

All risk car insurance covers everything from scratches to theft but costs more than TLO. See what it covers, what premiums run and who should choose it.

By Izkey Newsroom

Published February 14, 2018, 6:06 PM WIB 2 min read

All risk car insurance is the most common type of car insurance that insurers offer. It means the insurer covers every kind of risk and damage to your car, from minor damage such as scratches or scrapes from a sideswipe to the loss of the car through theft or robbery. Sounds like a better deal? It is, if you want total protection for your car, because the insurer can cover every kind of damage. But there is one important thing to watch: the premium is relatively higher than for other types of car insurance. An all risk premium is usually calculated at roughly 2.5% to 3.5% of the car's price per year. So the more expensive your car, the higher the premium.

Risks covered in full

The risks that threaten you on the road can undeniably be frightening, and anything can happen to your car without warning. Having all risk car insurance that pays for those risks naturally lets you feel safer.

The extended coverage can also pay for third-party liability when someone suffers a loss in an incident with the insured car. So if you can afford it, feel you face a high risk when driving, or your car is driven by someone still inexperienced behind the wheel (your child, for example), all risk insurance may be the better fit for protecting the whole car.

How does it differ from TLO insurance?

All risk insurance is often followed by TLO insurance, or Total Loss Only. TLO insurance covers car damage that usually exceeds 75% of the car's value, or a car lost to theft or robbery. It pays for repairing or replacing a car that is severely damaged in an accident, natural disaster, criminal act and/or riot. A scratched car or peeling paint is not covered by TLO insurance, but its premium is more affordable and not as high as all risk.