Rental insurance in Cozumel

When you rent a car or moto in Mexico, you need to be aware of the fact that insurance from any country other than Mexico will not cover you or damages you might cause in an accident. Some US and Canadian credit card companies offer a reimbursement of the cost of the damages you might incur in an accident, but they do not reimburse that amount right away; you will have to pay for the damages in cash to the rental agency and any injured party before you will be allowed to leave Mexico, unless you have a Mexican insurance policy that covers the damages.

Victims of auto accidents in Mexico have a right to claim “Actual Damages” from the driver at fault. “Actual Damages” is defined as “damages based on the actual value of the other vehicle, plus damages resulting from lost wages, and medical expenses for the other driver or occupants of his or her vehicle”.

If you have an accident in Cozumel and someone or something is hurt or damaged, the likelihood is that the police will be called to the scene. You will need to either work out and pay a financial settlement with the injured party for the Actual Damages and get a signed agreement and receipt of payment from the injured party on the spot of the accident, or you will be taken to the police station to work it out there.

If you have an insurance policy with the rental agency, they should send someone to the station to handle the settlement with the injured party so that you can be released.

If the cost of the Actual Damage exceeds the amount of your coverage, you will be held at the station until you come up with the difference in cash.

If the insurance was voided because you were under the influence, speeding, or breaking a traffic law when you had the accident, you will be held at the station until you come up with the total cost of the Actual Damages in cash.

If you can’t get your hands on enough cash (while being held at the police station) in a reasonable amount of time, you will be transferred to a jail holding cell until you do. It is also good to remember that a judge can award “extra” damages if he feels the circumstances justify a higher penalty; for instance, if the driver at fault was driving recklessly or had any level of alcohol or drugs in his system at all.

That is another good point to bear in mind; there is no “Legal Limit” in Mexico. Any level whatsoever of blood alcohol will void your car insurance if you are in an accident.

The minimum wage in Mexico is used to calculate maximum liability damages in the case of an auto or moto accident that results in the death of a third party. Recently, that amount was raised to 5,000 times the minimum wage of 80.04 pesos, or about $20,000 dollars, plus funeral costs. The federal government also allows states to raise that calculation to 5 times that amount. In Quintana Roo, the calculation only comes to about $25,000 usd. In other states it is much higher

Quintana Roo mandates that all drivers have auto insurance. They do not require that you have enough coverage to handle every kind of incident. Not all car or moto rental companies in Cozumel have the same insurance policies or the same coverage.

You need to read the policy and make sure it has enough coverage. Then, you need to make sure you don’t void the policy by driving after a drink, driving off-road (dirt roads) or having someone not listed on the policy drive the vehicle.

A new wrinkle is that, although the law has been unenforced for many years, PROFECO (the Mexican consumer protection agency) and the local government have been reminding rental agencies that it is the law that you must have a motorcycle license to rent a moto or scooter. I would assume that would mean that having a wreck while driving a moto without having a motorcycle license could void your insurance as well. Time will tell how that rolls.

As I mentioned, not all rental agencies offer the same amount of liability coverage. One of the international chains represented on Cozumel, offers $500,000 USD worth on their PLI policies. Other agencies only offer lower levels of coverage, some as little as $30,000 usd. That is not enough to cover, for example, the deaths of two members of the family of four on the moto that your jeep broadsided. Just the death benefit alone would be 50,000 USD (25K per fatality in Q.R.) plus the funeral costs and other actual damages: moto, hospital costs for the two survivors, etc. Everything over the 30,000 limit of their coverage would need to be paid by you, in cash, and you would need to obtain a “document of forgiveness” signed by the survivors or their heirs before you were released.