Good News – Bad News Mexican car rental rates look wonderfully cheap on websites, but they don’t include insurance, which can easily double, and in some cases triple, the cost of renting a car. Declining to buy the insurance some of which is mandatory, is foolhardy to the extreme, but buying the full package without knowing what you’re buying is a mistake also.Penetrating the insurance thicket: Mexican car rental companies offer various types of insurance, and only one is mandatory. Here are the basics.
Basic Personal Liability: Called third-party liability insurance, this is the one mandatory insurance in Mexico as it is in the majority of the USA. It covers claims for injury and or damage you cause to another person, car or other property in an accident,. Mexico does not accept liability coverage from U.S. auto policies or credit card insurance. You simply cannot rent a car without Mexican liability insurance. By law a small amount of liability insurance is included in the rental price; however the mandated liability coverage amounts to less than $4,000.00 US Dollars. Nobody in their right mind wants to take a chance that this much coverage is adequate in Mexico. If you are under insured your most memorable vacation sight could include the inside of a Mexican jail until you pay off your obligation.
#1 Supplemental Additional Liability Insurance (SAI or SLI): Additional liability insurance is the answer to the third party liability coverage problem and is available from all rental agencies, price and coverage amount varies. BBB’s (SAI/SLI): Insurance policy coverage coverage is $5,000,000.00 pesos total for property damage, injuries and death, $400,000.00 pesos for occupants medical, plus $5,000,000.00 pesos for legal assistance. *Our Policy Coverage appears to exceed all competitors stated coverage and there is Proof of Insurance Policy Coverage information in every one of our rentals.*
#2 Loss Damage Waiver (LDW): Also called collision damage waiver (CDW). This is actually not insurance, but the rental agency’s agreement to waive some of the cost of theft or any damage you inflict on the rental vehicle. Keep the following in mind: You are responsible to the rental collision damage waivers usually carry a deductible equal to 10 to 20 percent of the vehicle’s value, so company for any loss or damage to the vehicle no matter what the cause is or who is at fault. In addition depending on what you rent this could be a significant amount of money. There is also a loss of use clause that allows rental agencies to add an amount of their estimate of their loss of business because the rental is not available to rent while it is being repaired. Not all credit card coverage will pay for this type of claimed loss. You will be detained until money matters are settled. Before you decline LDW or CDW verify that your auto policy or credit card covers you for a car rental in Mexico, and that it includes this loss of use charge. This one requires some research and some careful thought. If your own auto policy or credit card insurance benefits cover collision damage to a Mexican Rental Vehicle, you can pass on the collision damage waiver. Most other Rental Franchises will fight you on this and insist on you buying their coverage. If you insist on not buying it they will then insist on you executing a separate credit card voucher for their deductible amount that they will hold and execute if their is any damage to their vehicle. This voucher can can sometimes be up to $5,000.00 or more and does freeze that amount of money on that cards account. Do yourself a favor and read the exclusions carefully in fact read them twice. There are times the small print will deny coverage when you least expect it: As an example clauses excluding damage to cars driven off-road have been used to deny a claim for a car damaged in a dirt parking lot.
BBB’s (LDW): Waives all charges for any damage to our rental car after our deductible.
#3 Zero Deductible Waiver (ZDW): This waiver sold by other rental agencies eliminates you having to pay any deductible in the event of damage to the rental vehicle. If as an example the rental agencies deductible is $3,000.00 (ours is $1,000.00) then you will have to pay for damages up to the deductible to the Rental agency before leaving the country. You then can file a claim with your insurance company to be reimbursed for the difference between what you had to pay and your stated deductible on your policy or credit card coverage.
(ZDW): Is not sold by us, what we offer is a rental contract that has no deductible for a modest charge. In the event of loss or damage we will assist you in obtaining a claim number, and BBB then will file the claim for any loss directly with your insurance company or your credit card insurer. This option eliminates any personal responsibility to pay any deductible for loss or damage.
To Consider: Purchasing complete rental car coverage in Mexico eliminates any unexpected transportation expenditures on your trip and as a bonus there is no chance of your driving or accident record at home being negatively affected for anything that happens while you are in Mexico. Most Credit Card rental insurance is Secondary Coverage . . . if you have any other policy that covers a Mexico rental that insurance will have to pay any and all claims before the Card Company . . . so that will expose you to higher premiums in the future.
A Google search for an explanation of policy benefits and exclusions for Visa, Master Card, and American Express credit card holders turns up many links. Here is one of the best . . . cardhub.com
Also you search Visa Card Benefits, Master Card Benefits or American Express Benefits and research your cards rental coverage benefits benefits.
Trip Advisor also has a great article about Mexican rental Car Insurance . . . tripadvisor.com
*50% Savings when compared to Local Rent a car Franchise’s web site’s posted insurance and waiver rates