What is Mexican Car Insurance, and Why Do You Need It?
What is Mexican Car Insurance, and Why Do You Need It?
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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 rental car or one that you own, you need a special type of car insurance. Whether you want to take a leisurely road trip through our neighbor to the south, or you need to conduct business, here’s all you need to know about Mexican auto insurance.
Why do you need car insurance in Mexico?
Mexico does not recognize American auto 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 discussion may all be happening in Spanish. Getting into an accident is already enough to disturb your vacation. Don't let it ruin your travel plans 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; you can purchase coverage online through a trusted car insurance company.
Large insurers like AAA, Progressive and Geico have partnerships with Mexican insurance companies that specialize in international car insurance policies. There is also the option to purchase it at the border, but usually the cost of those policies is several times more expensive. Overall, a Mexican car insurance policy isn’t all too different from an American one, either. The company 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, you won’t need to provide much information about your driving record before you purchase Mexico auto insurance. Coverage consists of a lump-sum liability limit, some sort of first-party medical insurance benefits and uninsured motorist insurance. The best Mexican car insurance policies may also have the option to add other endorsements, such as rental car insurance, roadside assistance and even coverage to pay for plane tickets should something happen to your car.
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 further 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.
Car insurance requirements for driving in Mexico
You need to carry Mexican auto insurance to drive legally in the country, as liability coverage is mandatory. If you're involved in an accident while driving in Mexico, the maximum amount you may have to pay out if another party is injured or killed in an accident varies depending on where you drive. Therefore, you should check the laws of the Mexican state you will be driving in, as it impacts the amount of car insurance you'll need in Mexico.
It is generally recommended, based on Mexican laws for possible payouts for bodily injury or fatality, that drivers get a minimum of about $300,000 worth of third-party liability damage coverage. 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 insurance 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 Mexican car insurance 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|
These three companies are the ones referred from AAA, Progressive and Geico, but each insurer underwrites the Mexican auto insurance policies themselves.
How do you file a claim?
If on your road trip in Mexico, down from Texas or Arizona, you get into an accident, the individual companies in the table above will handle the claims. It should be clear that while Progressive and Geico may direct you to these policies, they are not your insurer. If you need assistance with your Mexican auto insurance policy, Geico and Progressive are partnered with MexPro and International Insurance Co., who will provide any extra help.
Once you purchase your policy online or through an agent, 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 to ensure a smooth process, it’s most important that you comply with the insurance company every step of the way and get them the forms and paperwork they need. MexPro does say, however, that if you feel like your treatment is not adequate, they may be able to step in and assist.
Mexico car rental insurance
If you travel to Mexico and then rent a car, or you drive a rental car to Mexico, you will still need insurance. Renting a car in Mexico is about the same as renting a car in the U.S., except in Mexico, the same insurance laws apply to rentals as they would to a car you owned.
Most major car rental services operate in Mexico, including Hertz, Enterprise, Avis and Alamo, to name a few. All of these companies provide their own Mexican rental car insurance policies for their vehicles. You must buy at least the liability portion of that insurance to satisfy Mexican law.
We recommend that you also buy the collision damage waiver (CDW), the portion that covers the cost of theft or physical damage to the car while you travel. 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 Mexican 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 CDW, but not the liability insurance for your rental car.
Mexico motorcycle insurance
If you're riding a motorcycle in Mexico, you can similarly purchase insurance online or through a company that offers international motorcycle insurance. Most policies offer liability insurance, but we recommend that you look for a Mexico motorcycle insurance policy that also offers coverage for physical damage to your bike and theft. A full-coverage policy will cost more, and be harder to find, but it can easily be worth the investment if anything happens to your motorcycle while traveling.
Just note that a Mexican motorcycle insurance policy usually won't include first-party medical insurance, so you may need to purchase this separately through a travel health insurance policy.
The information related to Chase Sapphire Preferred® Card, has been independently collected by ValuePenguin and has not been reviewed or provided by the issuer of this card prior to publication.
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