Planning to rent a car in Mexico? Better make sure that card isn’t maxed out. Reader Paul writes in:
My wife and I have been to Mexico about a dozen times over the last 10 years, and about half of those times we have rented a car. In recent years I have seen information on various travel sites about the need for Mexican insurance when traveling in Mexico. I thought that this only applied to driving a personal car into Mexico, and not to rental cars; however, three weeks ago I came across a new twist:
Upon picking up a Hertz rental car at the Cancun airport (which, by the way, is the cleanest, friendliest, most efficient, of all Mexican car rental agency locations I have seen!) I was asked if I had insurance. I said, “Yes, I am covered by my VISA card for damage to the rented automobile.” The agent said, “Fine, but do you have Mexican insurance?”
I said, “No.”
Because I declined, the rental agency took a deposit (actually a “hold” placed against my VISA card) for $2,600 (26,000 pesos) to cover any potential damage!!
It wasn’t a problem, thankfully, but it did give me pause, and it made me worry a bit more about the car…perhaps that was the point?
Before the paperwork was final, there was another cute twist. A round wire cage with multiple colored balls (large marble size) was on the counter. I was asked if I would like to try my luck, that there was no obligation, but that I could win an upgrade for a modest amount.
I spun the cage, drew a 79, and was therefore eligible for an upgrade to the next level for 79 pesos per day (about $56 for the week). I declined.
We ended up with a 4-door Fiat Palio (which I had never heard of before) with stick shift, and we were pleased with the ride, the handling, and the gas mileage for the week. We returned the car unharmed (but they checked out every part of the car, looking for damage) and the hold was released.
I’m still not sure what the real story is on the need for Mexican insurance while driving a rented car in Mexico. Neither Hertz nor Bravo (a Mexican insurance company referred to me by USAA) responded to my emails on this topic.
You were right to decline the Mexican insurance, because, indeed, your Visa card covered you. You get primary insurance on car rentals outside your country of residence — secondary insurance when you rent domestically.
So you didn’t need Mexican insurance. After all, if you NEEDED it, they wouldn’t have let you drive the car off the lot.
At the same time, the car rental agency was (unfortunately) within its legal rights to put a sizable hold on your card. It’s crappy, but it’s legal.
Many car rental companies place a hold on your card when you rent the car, but usually a smaller sum. This isn’t just a Mexican anomaly.
The wheel-of-fortune upgrade spin is funny, especially since it’s hardly a great deal.
Bottom line, make sure the credit card you use on your Mexican car rentals has a beefy credit limit. Call your card company in advance to warn them that you’ll be traveling internationally, so they don’t lock it when a big charge comes online. And carry more than one card, so you aren’t stuck calling home, begging for a Western Union Moneygram.
Related:
- Loss of use? Get lost.
- Reader mail: Why would I want to upgrade my rental car?
- Reader mail: What happened to car rental late-return grace periods?
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December 6th, 2007 at 1:39 am
I go to Mexico for business a lot–specifically to Cancun, and I’ve used that Hertz office several times. It is quite nice!
I’m glad to see this post, because I never get additional insurance, and always tell them my credit card will cover it–which I think is true, but of course you get that nagging feeling that maybe you’re misunderstanding the terms when the guy at the desk says you really need extra insurance. From Hertz, though, I’ve only gotten light push-back, with the desk guy saying I really need extra insurance, a couple of times. I ignore it, but always wonder.
This last trip, I initially booked through a different rental agency–not Hertz. I noticed that its online booking page said liability insurance was absolutely _required_ at Mexican offices. I checked with Budget and a couple of other international agencies, and they all said the same thing.
Hertz’s website did not specify this, so I rented with Hertz, and had no issues at the office.
So, in fact Hertz seems to currently be the best of the lot. I don’t mind having the hold on my card. I _would_ mind having to pay for unnecessary insurance.
December 6th, 2007 at 2:29 pm
Do you have a rundown of which credit cards actually do best at covering you in rental cars? Like Zora, I always think I’m misunderstanding something about coverage. Thankfully, I’ve never had to deal with that in an accident yet (knock on wood), but I’d like to understand it better.
December 9th, 2007 at 7:45 pm
Great info! Do you know if debit VISA cards cover this as well or if it is just for their credit cards? I (gasp) don’t have any credit cards and usually get by with only my debit cards. I’m planning an international vacation soon and it would be helpful to not have to buy the insurance – perhaps i’ll get a Visa for just this reason.
December 10th, 2007 at 5:50 pm
You should understand what insurance you don’t have, however. I read the VISA link and personal liability and injuries or damage to anything inside or outside the car is not covered.
January 3rd, 2008 at 3:53 pm
Interesting post. The same applies for travel to Canada too!
March 24th, 2008 at 8:39 am
I just called my insurance company (USAA) about this Mexican insurance issue and they told me that if you get into an accident that it is a FELONY if you do not have Mexican insurance. I have also read in many travel books that you do not want to get involved with Mexican police. I’d rather be safe than really sorry. Or perhaps just rely on taxis!
May 12th, 2008 at 7:48 pm
Yeah, what we’re talking about here are two different kinds of insurance: Numero Uno: “insurance” on the car that pays to fix to Hertz’s hunk of metal, and Numero Dos: “insurance” that pays to heal/mend/repair whoever or whatever you hit in Mexico.
If you get in an accident in Mexico, La Policia will just laugh about Hertz’s bent up car. They might even say it makes it look like it belongs. So only Hertz’s cares if you have Numero Uno.
But if you get into an accident and hurt someone or something, no matter how slight, and you don’t have Numero Dos, you’re going to jail. It IS a felony and La Policia will hold you (your body, not your money, your car, your lawyers’ name, YOU) until you stand trial for the felony you just committed.
And one thing about Numero Dos: the policy better be written in Espanol and have a Mexico City or other Mexican address, because only insurance issued by a Mexican company is recognized. And VISA no habla.
Finally, chances are if you’re like most gringos and find yourself in an accident on vacation, some guy named Jose Cuervo may have played a role, and not having Numero Dos would make a very bad situation even worse.
Buy the freakin Mexican insurance. And while sipping/gulping Cuervo ponder the irony: middle class gringos saving what amounts to at most $200 on a trip where they can act like ultra wealthy people for a week or two (and in Mexico, you are). But in Mexico the government still trumps wealth.
July 12th, 2009 at 8:25 pm
From AOL-Travel:
In Mexico, it is required by law that liability insurance be included in the rate of all car rentals. If a rental car company tries to tell you otherwise, don’t believe them. You may, however, still be interested in comprehensive rental insurance. This additional coverage will also cover you in the event that your belongings are stolen while in the car. Be aware of the applicable deductible that comes with comprehensive coverage before deciding if it will be beneficial to you.