Car Rental Insurance

Car rental in Mexico can sometimes be more expensive than renting a car in the USA. The principal increase in cost is the additional price of the optional insurances required to protect the vehicle.

When you book a Mexico car rental online, the fee presented on-screen usually includes a third-party coverage insurance policy, but in most cases you’ll need to purchase optional top-up insurances for the vehicle at the counter.   If you don’t insure the vehicle separately from the rental charge, in the event of an accident, theft, fire or total loss of the vehicle, the rental company will present you with a excess charge, usually based on a percentage of the commercial value of the vehicle ‘as new’.  The fee is usually between seven and twenty per cent of that amount, depending upon the vehicle type and the agency’s terms.

For example, if the car you’re renting has a commercial value of US$15,000, and the car rental company requires you to cover ten per cent of the vehicle’s value in case of any damage or loss, your excess fee would be US$1,500 in the event of any mishap.

When you arrive at the rental counter, you will have an option to “top up” the third party insurance coverage with a further fee that either limits the excess fee or provides “full cover” for the vehicle.   These options are essentially additional insurance products and, if you choose to buy all them, the fees can nearly double the price of your initial car rental quote.

You might have a credit or charge card that covers you for car rental insurance when you use the card to settle the purchase.  The cards which provide this type of insurance usually carry a premium fee of their own – check with your financial institution for details.  In the event that you use a separate insurance policy (whether provided via credit card or other means) to provide “top up” cover for your rental vehicle, verify that it’s valid for rentals in Mexico and also find out what the arrangements are in the event of an accident or loss.  These perks, when they are properly verified, can save you a lot of money on car rental insurance fees.

If you don’t take on the agency’s additional insurance products, you’ll be asked to sign a section on the rental agreement that makes you explicitly responsible for the vehicle whilst it’s in your care.

The exact cost of the insurance coverage varies depending on the vehicle type and duration of the rental, and you’ll be presented with coverage options when you arrive at the counter to take possession the vehicle.

As a rule of thumb, if you double the price you are quoted online, you should find that the total rental price, with “full cover” (all insurance options) included, should be slightly less than that.  You can opt to take less cover, but will be liable to higher damage costs in the event of a mishap.

Our guides to Driving in Mexico and Car Rental in Mexico give comprehensive advice and tips about taking a road trip and renting a car.