If you plan on taking a car into Mexico, buy
auto insurance
and be aware of the different laws.
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Each year, Arizonans
pack up their cars and drive to Mexico to enjoy the
beaches of Puerto Penasco and other popular
destinations.
High on the checklist of issues people need to address when driving
across the border is automobile insurance, an important
but often overlooked aspect of the Mexico experience.
With proper coverage, people possess a necessary safeguard in the
event they are involved in a traffic incident. Without
it, travelers risk of paying exorbitant fines and
spending time in jail.
Buying the right Mexican auto insurance policy can be tricky given
the differences between Mexican and American laws.
"A lot of people unfortunately make incorrect assumptions," said
Lanny Hair, executive director of the Independent
Insurance Agents & Brokers of Arizona in Phoenix. The
association represents independent agency firms, many of
which sell auto policies through Mexican-based
companies.
One of the biggest assumptions travelers make is that their U.S.
auto insurance will cover them if they are involved in
an accident in Mexico. That's not true.
"The Mexican government will only recognize those companies
authorized to do business in Mexico," Hair said.
Under Mexican law, it is a felony to not carry at least civil
liability insurance issued by a Mexican-based company.
The insurance pays for damages and injuries that a
person causes another driver.
Drivers also can opt to purchase a full-coverage policy, which will
cover their own vehicles in case of an accident.
In 2005, there were 19 Mexican insurance companies that issued
policies to U.S. drivers, collecting $71.2 million in
premiums, according to the Mexican Association of
Insurance Institutions.
Guilty until innocent
Although Mexican auto insurance provides coverage similar to U.S.
auto insurance, the driving laws in either country
differ.
"If you have no Mexican liability insurance and you're involved in
a crash, you'll almost certainly spend some time in jail
because in Mexico you're guilty until proven innocent,"
said Yvette Lopez, a spokeswoman for AAA Arizona in
Tucson. AAA sells Mexican auto coverage, which on
average can cost $30 or more per day.
Regardless of who is at fault in an automobile accident, guilt is
always presumed, Lopez said.
"If you have (Mexican) auto insurance, it may not prevent you from
actually being detained while the cause of who is at
fault is still being determined," she said.
Most Mexican liability policies provide a certain amount of
coverage for legal aid and bail bond.
Reporting claims
In the event of an accident, drivers must report the incident to
the insurance adjuster while they are in Mexico. Drivers
who re-enter the United States and try to file a claim
will find that their insurer will not provide coverage.
"The policy is valid strictly in Mexico," said Hubert Brossoit,
president of Flagstaff-based Drivemex.com, a broker that
sells the policies of eight Mexican insurance companies.
Drivers also should research the claims-paying ability of insurance
companies before purchasing their policies, said Jim
Labelle, president of International Insurance Group Inc.
in Flagstaff. The company manages the sales of five of
Mexico's largest auto insurers and sells policies
through its Web site, Mexpro.com.
Labelle suggests drivers buy from companies that are rated by A.M.
Best or Standard & Poor's, which rate companies based on
performance.
Coverage differences
There are some irregularities between what U.S. auto insurers cover
and what Mexican insurers cover.
A key difference is almost all Mexican insurers do not
cover vandalism or partial theft.
"Your car basically needs to be gone" in order to file a theft
claim, Lopez said. "If your window's broken you would be
responsible for the damages."
In addition, drivers who are hauling trailers behind their vehicles
need to declare it on their liability policies.
Otherwise they will not be covered if the trailer comes
loose and causes an accident.
Lessees beware
People who are leasing or financing an automobile should think
twice before driving their vehicle south. Nearly all
lease policies prohibit people from driving across the
border, even if they have full coverage from a Mexican
auto insurer.
Lessees who do not get permission before crossing and are involved
in accidents are still required to pay the balance of
their lease or loan.
"They have the obligation to repay the loan or the lease whether
the car is there or not," said Tom Kelly, spokesman for
JP Morgan & Chase Co.
Copyright (c) The Arizona Republic.
All rights reserved. Reproduced with the permission of
Gannett Co., Inc. by NewsBank, inc. |
|
Heading
south?
Here's what you need to know about Mexican automobile
insurance, including where to get it, what it covers and
what it costs.
• Liability auto insurance is required of all drivers
under Mexican law. Checkpoint security officers may
require proof of insurance upon entering the country.
• A number of insurance brokers run Web sites that allow
drivers to purchase and print policies online. They
include
Mexpro.com and
DriveMex.com. Several agencies also sell policies in
offices near the border.
• It is important to research any insurer before
purchasing a policy to make certain it is a reputable
company.
• When listing the value of your vehicle for insurance
purposes, use the high Kelley Blue Book value to ensure
you are getting maximum coverage.
• Purchase enough coverage to last the duration of your
trip.
• Always keep a copy of your policy with you. If your
vehicle is stolen and your policy is inside, you may not
be reimbursed.
• Report all accidents while in Mexico. Insurers in most
cases will not pay claims that are filed after a person
leaves the country.
• Most Mexican insurance policies do not cover partial
theft or vandalism. To claim a theft, a vehicle must be
stolen entirely.
• If leasing or financing a vehicle, obtain permission
to cross the border first. Most leases prohibit a person
from driving across the border, even with a
full-coverage Mexican insurance policy. |
