The Important Reason Tourists Should Consider Additional Insurance When Renting a Car in Mexico

Using a rental car is a great way to explore what Mexico offers at your own pace. This is especially true if you want to tour lesser-known destinations or visit several locations quickly. In addition to the dazzling hidden beaches in Mexico, the country also boasts other attractions like the “Grand Canyon Of Mexico” (a stunning beauty amid majestic mountains), ancient ruins like Chichén Itzá, and breathtaking natural swimming holes. It is no wonder that this North American gem attracts over 50 million visitors each year, bringing people from around the world to explore its vibrant culture and warm climate.

However, before you hit the road, it is important to be aware that your U.S. insurance won’t work in Mexico. To get behind the wheel legally, you will be required to have Mexican third-party liability insurance. To make the situation even more upsetting? You actually risk hefty fines or even jail time if you get into an accident without Mexican coverage, even if you are not at fault.

Under Mexico’s federal liability law, all drivers must have third-party liability insurance from a licensed Mexican insurer. As a result, most car rental companies in the country have a mandatory Mexican third-party liability insurance policy requirement for renters. Your U.S. insurance will not work in the Land of the Maya. In addition, if you are caught driving without the Mexican liability insurance, you risk hefty fines or a jail term.

The Mexican third-party liability insurance covers injuries you cause to others and property damage in an accident where you are at fault. While the minimum liability coverage for drivers in Mexico is around $5,000 for bodily injury or death and about $2,500 for property damage, most licensed insurers recommend coverage that starts at a combined limit of $300,000 based on how fines are calculated. If you are at fault in an accident that results in a fatality, the law requires that your insurance must pay the state’s minimum wage 5,000 times.

Your liability could easily add up to $500,000, depending on the state. In addition to the 5,000x minimum wage, you may be required to pay for funeral expenses, and some states may multiply the overall compensation five times. This is where the Mexican third-party liability insurance can save your bacon. Otherwise, you can be arrested and jailed, as authorities have the right to detain you until the case is settled.