If you have a small loop and only 1 drop there is no need for a terminal block. Small would mean less than 10 track joints on the loop.
For a loop greater than 10 and smaller than 20 joints you would divide the loop into 2 equal segments with insulated rail joints on the center rail only. 2 Voltage drops would go halfway between the insulated pins. The voltage drops would connect to a terminal block and 1 wire would go to 1 TIU channel. If you ran each voltage drop wire into the TIU without a terminal block it would make no difference. The terminal block is there to make wiring easier.
The purpose of the insulated track block is to keep the engine from receiving multiple signals from the TIU.
