Property ownership in Mexico carries all of the same responsibilities of property ownership elsewhere, and protecting your valuable physical assets against unforeseen events is an essential consideration as you formulate your annual budget.
It’s worth noting that home insurance is distinct from Property Title Insurance. Home insurance covers the buildings, certain personal items, and third party liability should someone injure themselves or, for example, if a tree or wall falls onto an adjoining property. Title Insurance covers you in the event that the title deed of the property you purchase turns out to be invalid causing your right to the property to be brought into question, and pays out compensation in the event that you lose title to the home you purchased.
Property insurance policies sold in Mexico differ from policies you are used to seeing in your home country. The policy wording is unique, and the types of coverage offered by insurance companies is different here, so some things that you would expect to be included as standard, might not be present if you purchase your insurance in Mexico directly from a Mexican insurer.
To help foreign residents who own property in Mexico to purchase insurance products familiar to them, specialist companies based in the U.S. have developed property ownership insurance policies which reflect the wording, terms and covers included on US and Canadian policies. The insurance policy is fully underwritten by a Mexican insurance company (by law, it has to be this way), but the U.S. companies work in partnership to create a product that is familiar to those purchasing insurance in the US and Canada, and which is legally sound under Mexican law. The premiums are paid in US dollars and any pay-outs are also paid in US dollars.
The home insurance policies available in the market offer a wide range of options, and you can choose what to include and what to exclude as part of your coverage plan. Depending on where your home is situated in Mexico, the risks (and coverage) you need to insure against will vary. For example, homes near the coast should be insured against hurricane damage and earthquakes, whereas inland only cover for earthquakes (and perhaps flooding, if you home is situated near water) will be needed.
Policy options and choices include all risks versus named perils, whether to cover assets like outbuildings surrounding the main property, and the option to insure your personal goods. The better policies will include coverages for third party liability: this is helpful in the event that someone who does not live at your home meets with an accident on your property, or where some damage is caused to a neighbor, e.g. by a falling tree. This article about third party liability in relation to your home shares more details.
Other considerations to take into account when you’re assessing your insurance needs include purchasing cover for any watercraft you may own, as well as special arrangements for condos, where some liabilities are shared and some are owner-specific.
Regardless of the type of insurance you choose, the insurer underwriting the policy is far more important than the broker or agent selling you the product: in the event of a claim, the integrity of the underwriter will determine pay-outs, not the insurance broker.
Learn more about insuring your property in Mexico
Our guide to Property Insurance in Mexico will help you to understand the insurance market here, and also connect you to online quotes from our home insurance partners, MexPro, who offer comprehensive coverages at competitive rates, with policies issued in English by a licensed U.S. broker, and fully-underwritten by insurers in Mexico.