Is your US automobile insurance policy good in Mexico?

 

Many US insurers provide coverage to their clients for a limited number of miles within Mexico. But the real question is, "What exactly is covered and will Mexican authorities honor it?

 

US insurance does not qualify for meeting the standards under Mexico's financial liability laws. Thus from that standpoint, your US policy does not serve you well in Mexico, as it does not provide acceptable liability coverage.

 

This is not to say your US policy won't pay damages suffered by your vehicle. An insured motorist can make a claim against the US policy for vehicle damage suffered in Mexico. Claims accompanied with all the documentation required by the particular insurer might be paid, but will be subject, of course, to the "Mexico Coverage" restrictions and guidelines described on the U.S. policy. It's worth stressing, however, that no matter what the U.S. policy states, the liability insurance on the policy is not honored in Mexico. Policyholders must, at the very least, acquire this portion from a Mexican auto insurance agent.

 

As a side note, it is very important that the Mexican insurance be purchased on the U.S. side of the border (as opposed to waiting to cross over into Mexico). The importance is because in the case of a dispute, states in the U.S. have very effective insurance regulatory agencies monitoring agent's conduct and mediating disputes. Attempting to dispute in Mexico on a policy purchased out of the U.S. jurisdiction could be a futile effort. Adding to why insurance should be purchased before crossing into Mexico is the obvious… the motorist would be driving to the Mexican agent's office already in Mexico uninsured.

 

The reasoning for the non-acceptance of the US policy as meeting the financial responsibility requirements is that Mexican courts have no jurisdiction over the US company. If the US company refuses to pay, there is no recourse in Mexico against it.

 

The best and probably only benefit of your US policy is that it covers damages to the insured car. This may be of importance since the cost of repairs in Mexico, as compared to those in the US are very different. A $1000 fender-bender in the US may only be a $100 fender-bender in Mexico.

 

If the US driver is not at fault, the responsible party is only liable for the repairs at cost in Mexico. Unless the US driver can leave the car in Mexico while repairs are done for the Mexican adjusted amount, returning the car to the US may be in the driver's best interest.

 

US drivers in Mexico should become familiar with their US coverage while in Mexico, and the procedures the company requires in order to file claims in the event of an accident while in Mexico.