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Every year thousands of Americans drive into Mexico. Many may not know, however, that their American car insurance is invalid in Mexico. If you enter Mexico with a car, you need a special type of car insurance. Whether you want to take a road trip through our neighbor to the south, or need to conduct business, here’s all you need to know about car insurance in Mexico.
Why Do You Need Car Insurance in Mexico?
Mexico does not recognize American insurance policies. If you get into an accident anywhere in Mexico, you will not be able to use your car insurance to cover the damages. As a result, Mexican authorities may arrest you, and impound your car until the matter can be settled. Without a proper way to pay for damages, the process may take a while. Remember too, this can all be happening in Spanish. Getting into an accident is already enough to disturb your vacation plans, don't let it ruin them by having an insurance mishap. The risk and consequences are too great to not purchase a policy before you go to Mexico. Luckily, it is easy, and comparatively inexpensive to get your own Mexican car insurance policy.
How Do You Buy Mexican Auto Insurance?
The best way to buy Mexican car insurance is the same as regular car insurance; online through a trusted company. Large companies like Progressive and GEICO have partnerships with insurance companies, which specialize in international car insurance policies. There is also the option to purchase it at the border, but usually the cost of those policies are several times more expensive. Overall, a Mexican car insurance policy isn’t all too different from an American one either. They will ask for:
- The Type of Car You Drive
- The Value of Your Car
- What Limits You Want
- How Long You Are in Mexico
- Where You are Driving in Mexico
- If Any Driver is Under 21
- If You are Towing Anything
In contrast to American insurance, there isn’t much questioning on your driving record. Coverage consists of a lump sum liability limit, some sort of first-party medical benefits, uninsured motorist insurance, and other endorsements such as rental car insurance, roadside assistance, and even coverage to pay for plane tickets should something happen to your car. The lump sum liability is the equivalent to combining bodily injury and property damage liability insurance in the U.S. Rather than having two separate capped values, which are futher divided into a "per accident", and "per person" basis, the lump sum can be allocated for as much is needed in a property or bodily claim. It is recommended, based on Mexican law, that drivers get a minimum of $300,000 worth of liability damage. That may be more than your limits at home, but it is considered well worth it. If you do not carry collision or comprehensive coverage on your current American policy, you will be ineligible for it in your Mexican policy.
How Much Does Mexican Car Insurance Cost?
Policies generally come in packages that are priced daily, semi-annually, or annually. A daily package may end up costing just as much as a six-month package, however depending on the duration of your stay. Overall though, the cost of a policy is not too expensive compared to American insurance. The quotes below reflect the price of a policy for a car worth $15,000, that has optional full coverage (including $300,000 worth of liability coverage).
|Grupo Nacional Provincial||$215||$371||$426|
How Do You File a Claim?
If on your road trip down from Texas, you get into an accident, the individual companies in the table above will handle the claims. It should be clear, while Progressive and GEICO may direct you to these policies, they are not your insurer. If you need assistance, GEICO and Progressive are partned with MexPro and International Insurance Company who will provide any extra help.
Once you purchase your policy, you will get a series of numbers you can call to file a claim in the event of an accident. The company will then send an adjuster to the scene to assess the damage. You must also file a police report. MexPro says the most important thing to ensure a smooth process is to comply with the insurance company at every step of the way and get them the forms and paperwork they need. MexPro does say however if you feel like your treatment is not adequate, they may be able to step in an assist.
What if You Rent a Car in Mexico?
If you decide to fly to Mexico, and then rent a car, you will still need insurance. Renting a car in Mexico is about the same as renting a car in the U.S., except the same insurance laws apply to rentals as they would to a car you owned. Most major rental services operate in Mexico. These include Hertz, Enterprise, Avis, Alamo etc. All of these companies provide their own insurance policies for their vehicles. You must buy at least the liability portion of that insurance to satisfy Mexican law. You should also buy the Collision Waiver, the portion that covers the cost of theft or any other ways the car can be damaged. Any damage you cause to the car, including if it is stolen, will fall on your lap to pay if you do not purchase the coverage. Inability to pay for damage may cause you to be detained in Mexico.
Another option for purchasing rental car insurance is through your credit card. Many credit cards, especially those tailored for travel, provide car insurance coverage for rentals in the U.S. and most foreign countries including Mexico. You should check with your credit card company or read the terms and conditions of the card to find out what is covered first though. The Chase Sapphire Preferred Card for example will only provide you with the Collison Waiver, but not the Liability.