If you are planning on taking your vehicle into Mexico for a sunny beach vacation, it’s important to remember that your Alberta insurance policy is not valid south of the U.S. border. There are major differences between car insurance in Mexico and provincial plans, and without the proper coverage you face heavy fines and may even end up in prison until the claim is settled. This process could take several months (or even years) until your ability to pay the penalty is determined. You may also be prevented from leaving the country, even if you require urgent medical care.
Mexican car insurance meets the requirements of the country’s “proof of financial responsibility” law, as the Mexican government considers auto accidents to be both a civil matter and a criminal offense. Only companies specializing in the provision of car insurance in Mexico are able to provide the right type of policy that will be recognized by the Mexican legal system.
How Does Mexican Car Insurance Work?
The liability aspect of car insurance in Mexico is where the major difference lies between Canadian and Mexican policies.
In Alberta, drivers must carry a minimum of $200,000 in liability insurance (although we recommend carrying much more), which covers you in the event that you are found guilty of driving negligence causing physical harm and/or damage to property. Liability is assessed according to the severity of each incident. Several limits exist for each type of situation, such as one for soft tissue injuries.
In Mexico, the liability limit is a lump sum, which varies state by state, and they can reach much higher amounts than what we are used to in Canada. Mexican law stipulates the limit to be the state’s minimum wage multiplied by up to 5,000, plus additional medical and funeral expenses. This can easily reach much more than $200,000 USD, so it is recommended that each person purchase at least $500,000 USD in Mexican liability insurance. In addition to the liability aspect, you may also consider purchasing extra coverages such as medical payment assistance, legal assistance, and roadside assistance. Some policies even offer plane ticket coverage should you not be able to drive your car after an accident.
An at-fault car accident in Mexico may result in liability exposures such as:
- Actual damages, which are based on the value of the other vehicle, lost wages, and medical expenses.
- Moral damages, which encompass pain and suffering endured.
- Other damages may be awarded by a Mexican judge depending on the circumstances of the accident. For example, if you were found to have been driving aggressively, or to have been impaired when you caused the accident, a judge may apply additional financial penalties.
You can purchase car insurance in Mexico to match the length of your stay, with the minimum usually being one week and the maximum six months.
How Can I Get Car Insurance in Mexico?
Mexican car insurance must be purchased at the border or before you cross. Purchasing your policy before you get to the border is likely to be cheaper, and you will also likely to receive a better, more complete explanation of your policy. Planning ahead, comparing policies, and asking questions is your best bet. Research coverage and make sure to have your policy in place before leaving home.
Three of the main car insurance in Mexico providers are ACE Seguros, El Aguila, and Grupo Nacional Provincial, however there are many others. These three come the most highly recommended, however, and policies are purchasable online.
Generally, questions that will be asked are:
- What liability limits you would like (remember, we recommend at least $500,000 USD)
- The type of vehicle you drive
- The value of the vehicle
- The dates you will be in Mexico
- Where you will be travelling in Mexico (which states you will visit)
- The age of the driver
- If you will be towing anything
If you have to file a claim, follow the guidelines set out by your provider. Reputable car insurance in Mexico companies will provide numbers to call if you are in an accident, and you should follow the steps they lay out as carefully as possible. An adjuster should be sent to the scene immediately to assess the accident. You will also need to provide a police report. Just like in Canada, you may describe what happened, but do not admit fault.
Most insurance policies will require that your vehicle be fixed at a repair shop in Mexico, so make sure you read closely to find a policy that will allow you to repair your car when you get back to Canada (if possible).
Mexican rental car insurance is slightly simpler, as rental car companies provide their own insurance at the place of procurement. But if you are renting a car outside of Mexico and then driving it into the country, triple check to make sure you have insurance for both the country of origin plus in Mexico.
The Lane’s Insurance Advantage
Lane’s Insurance is a client-oriented, full-service insurance brokerage that leverages unique relationships with insurance providers to offer customers unbeatable rates on all their insurance needs. We are locally owned and operated, and we offer every type of insurance you’ll ever need, including everything from motorhome and RV insurance to home insurance, auto insurance, commercial insurance and much more.
We are happy to offer plenty of advice and resources to make the right choice for your insurance coverage. Please don’t hesitate to contact us at Lane’s Insurance if we can help.
