The Prevalence of Uninsured Vehicles and the Risks Involved
In Mexico, approximately 62 million vehicles traverse the streets, with two-thirds lacking insurance coverage. Alejandro Sobera, president of the Automobile Committee at the Mexican Association of Insurance and Surety Brokers (AMASFAC), warns that not having insurance to protect your assets, person, and peace of mind in a traffic incident can be highly detrimental. The cost may exceed the value of your vehicle, which represents countless hours of hard work and dedication.
Consequences of Driving Without Insurance
Sobera laments that, in a severe accident without insurance protection, you could lose your entire property, including your home. Moreover, the consequences might even lead to losing your freedom.
Affordable Insurance Options in Mexico
Rigoberto Mora, president of the Automobile Committee at the Mexican Association of Insurance Institutions (AMIS), states that there are insurance options available for as little as seven pesos per day, offering basic coverage.
Understanding the Limitations of Basic Coverage
Although affordable, basic coverage may not be the most recommended option. Sobera attributes this underutilization to a combination of factors, including insurance companies, agents, and a low level of foresight among Mexicans. He points out that over 60% of vehicles on the road lack insurance, and among those who do have coverage, 90% to 95% are unaware of their contract terms.
Sobera emphasizes that there is no “all-against-all” insurance; instead, policies have conditions and clauses. He urges the insurance industry to find an approach that raises awareness about the importance of being protected.
Types of Coverage
Rosario Oliván, liaison for the Automobile Committee at AMIS, explains that there are three levels of coverage: basic (responsibility civil – RC), limited (does not cover damages to your vehicle), and comprehensive, which covers both your and third-party damages.
Responsibility Civil (RC) Coverage
RC coverage provides support for damages you may cause to third parties’ property or persons. It is the minimum legal requirement for driving in federal zones and some states where it has become mandatory.
While it may not suffice for severe traffic accidents, RC coverage ensures that the insurance company covers the costs incurred by affected third parties and prevents you from losing all your assets.
According to Oliván, the minimum legal RC coverage is half a million pesos, but some companies offer up to 20 million pesos.
Additional Coverage for Vehicle-Related Risks
Oliván also stresses the importance of having insurance for events like car theft, a daily occurrence affecting an average of 173 people. In the past year, only 42% of stolen vehicles were recovered, the lowest rate in the past five years.
Sobera advises that having insurance, even if unused, is ideal. In the event of a traffic accident without insurance, you may face significant losses and feel regret. To choose the best policy, consult with an agent who can guide you in selecting a plan tailored to your needs.
Key Questions and Answers
- What are the risks of driving without car insurance? Driving without insurance can lead to substantial financial losses, potentially exceeding your vehicle’s value. In severe accidents, you could lose your entire property or even face legal consequences.
- What insurance options are available in Mexico? There are affordable insurance plans starting at seven pesos per day, offering basic coverage.
- What does basic car insurance cover? Basic coverage, or responsibility civil (RC), supports damages you may cause to third parties’ property or persons. It is the minimum legal requirement for driving in federal zones and some states.
- What is the minimum legal coverage for RC in Mexico? The minimum legal RC coverage is half a million pesos, but some companies offer up to 20 million pesos.
- Why is it crucial to have insurance for vehicle-related risks? Having insurance for events like car theft is essential, as only 42% of stolen vehicles were recovered in the past year.
