Question & AnswerQ&A (LTO MEMORANDUM CIRCULAR NO. VPT-2011-1631)
Actual Total Loss refers to the physical or material loss of a motor vehicle when it is totally destroyed or rendered useless for its purpose, as defined in the insurance contract.
Constructive Total Loss is a commercial loss where the motor vehicle is beyond economical repair, i.e., when the cost of restoring it exceeds its insured value.
Only motor vehicles and/or components against which insurance claims for Constructive Total Loss were granted will be allowed registration.
The Insurance Commission is responsible for submitting a monthly report to the LTO Law Enforcement Service containing details of motor vehicles with insurance claims paid under the Total Loss Category.
The report must include photographs of the motor vehicle from different angles, motor vehicle number plates, original certificate of registration, and latest official receipt of payment of registration fees.
The LES encodes the details into the IT system to create an alarm, either under Alarm Type aCTL (Constructive Total Loss) or temporarily under Alarm Type aCR (CRIME), within two hours of receipt.
The applicant must secure a Lifting of Alarm Form, present the vehicle for inspection at a Motor Vehicle Inspection Center, provide documentary requirements including proof of ownership and insurance report, and then the CO OD evaluates the vehicle and documents before recommending lifting the alarm.
Required documents include proof of ownership, request for lifting of alarm, printed screenshot of alarm details, copy of the Insurance Commission report, Motor Vehicle Clearance Certificate from PNP Highway Patrol Group, and authority to transact with valid IDs if applicable.
If only the engine can be restored, the CO OD will prepare a Request for System Update to deactivate the chassis number and make the chassis alarm permanent, requiring duplicate number plates. Similarly, if only the chassis can be restored, the engine number alarm is deactivated with the same conditions for duplicate plates.
Registration is processed at the district office nearest to the regional office, except in NCR where it is at the Diliman District Office.
Violating personnel may be dealt with criminally and/or administratively according to existing rules and regulations.
It serves as the basis for issuing an alarm on the motor vehicle in the LTO IT system to monitor vehicles declared under Constructive Total Loss and prevent illegitimate registration or use.