Insurance companies do not always cover the full costs of car insurance claims. Vehicle owners typically still need to pay their own risk or deductible according to the terms set out in their policy.
The Financial Services Authority has set a minimum own risk for motor vehicle insurance of Rp300,000 per incident. However, the amount can differ among insurance companies and the policies they offer.
Own risk or deductible is a sum of money that becomes the policy holder's responsibility when making a claim. After this amount is paid, the remaining repair costs that comply with the policy terms are covered by the insurance company. For certain extended protection, own risk may also have special provisions, such as for flood risk which is set at 10 per cent of the approved claim value with a minimum of Rp500,000 per incident.
The type of protection determines claim coverage. All Risk or Comprehensive insurance provides protection against various vehicle damages in accordance with policy terms, while Total Loss Only has different coverage and is intended for total loss conditions according to set limits.
The actual calculation still depends on the policy contents, and a claim may not be approved if the incident or damage is listed as an exclusion in the policy. Car owners should understand the amount of own risk when first purchasing a policy and review the policy again before filing a claim.
