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UPDATED: Mar 13, 2020
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If you’re considering a trip overseas, your transportation options may be foremost in your mind. From planes to trains, ships to buses, you can use many forms of transit to reach your desired destination. In many cases, using a rental car can make your international travel even more flexible and enjoyable.
While people often think about travel health insurance or trip cancellation coverage, it’s also important to protect your safety by knowing how to handle car insurance overseas. When you’re operating as a tourist, using your own car ,even a rental, can give you an added sense of freedom.
And with so many rental shops available around the world, often with the familiar brands of home, it’s easy to start driving almost everywhere during a trip.
In general, however, your local auto insurance in the United States won’t provide coverage for your driving overseas. There are some exceptions closer to home, especially in Canada, where American car insurance is valid. The same is usually true for Canadians driving to the States for tourist purposes.
When you’re planning a trip, it can be very important to learn what is covered by your car insurance when you’re outside the country or when you’re just enjoying an American road trip. You can use online comparison sites to save by looking at prices and coverage options from an array of auto insurers. Shopping around can help you to find the best value and policy for your needs.
When in the U.S., is my car insurance valid outside my home state?
Almost every U.S. state mandates that you must have some form of car insurance before hitting their roads. Wherever you may call home inside the country, you should have car insurance, and it must be purchased in the same state where your car is registered. This information must match in order to ensure that you have valid coverage to protect your legal and financial interests.
That doesn’t mean your coverage is limited to your state lines, of course. Whether you live in a busy border or metropolitan area where crossing state borders is a daily occurrence or you’re taking a cross-country trip to see America, your auto insurance is valuable everywhere you go in the United States.
At times, your coverage may change slightly if you have basic liability coverage. This would reflect state minimum coverage that could vary from one state to another. In any location, you’ll remain covered by your auto insurer, and in some places, your basic coverage amount could even increase if the minimum requirements of that state are higher than those of your home.
This type of change would only apply to your basic liability insurance that provides coverage for personal injuries or property damage to other drivers.
When you want to make sure that you get the auto insurance coverage you need at the best price available, shop around online and compare the options available. Car insurers will provide free online quotes that can help you choose the right option for your auto insurance.
What if I’m traveling to Canada?
In general, when you drive from the United States and cross the Canadian border, your existing American auto insurance remains in place so long as you are driving in the car that is covered by the policy as a tourist.
Because Canadian insurance laws are extremely similar to equivalent U.S. laws, they are generally reciprocal, and each country recognizes the other’s insurance policies.
Canadian drivers can also come to the United States and don’t need to buy a different form of insurance.
In case you’re asked about your coverage, your car insurer can provide a certificate for presentation to the officials at the border. This document could be important if you do have any kind of accident or claim while in Canada.
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What about traveling to Mexico — does my insurance apply?
On the other hand, the situation is a little different if you are going to Mexico. There are some U.S. car insurers that offer physical damage coverage for your vehicle for up to 50 miles inside Mexico. Other optional policy choices could potentially extend your coverage inside Mexico.
However, your liability insurance wouldn’t apply to cover damages caused to other drivers and their vehicles if you have a crash in Mexico. Therefore, it is very important to add a Mexican liability policy to your own car insurance if you’re driving across the border.
Under Mexican law, tourists driving across the border into Mexico must purchase mandatory liability insurance. You can buy a Mexican policy for travel online or in person while crossing the border. You could be fined or even jailed if you have a car accident in Mexico and don’t have the relevant Mexican liability insurance.
There are also additional options available, including civil liability coverage, legal help insurance, medical expenses insurance and roadside assistance.
For travelers who are planning to drive south of the area known as the Hassle Free Vehicle Zone inside Mexico, you’ll also need to register for a temporary import permit for your car. In some cases, you could also need to place a security deposit.
Am I protected if I rent a car?
If you are renting a car in Canada, Mexico, or overseas, your regular U.S. car insurance won’t provide the protection you need. First, you need to ensure that you are eligible to rent a car at your destination.
Depending on where you are traveling, you may need an International Driving Permit. It’s easy to get this before you exit the country for your trip. However, in other cases, you will only need a U.S. driver’s license.
In some cases, your U.S. insurance could provide coverage for rental cars domestically. However, even those policies usually do not cover international car rentals. You can check with your car insurer for the specifics of your policy.
In some cases, your credit card may provide some insurance if you use it to pay for the rental car. There can be restrictions and limitations, especially overseas, so check with your credit card company to find out more about the protections available to you when renting a car internationally.
You could also speak with your car insurance company about supplemental options available for international travel. You can also buy car insurance directly from a rental agency.
While many U.S. drivers don’t find these coverages necessary inside the country due to their own policy protections, they could be important internationally.
The types of coverage options available include a Collision Damage Waiver for crash damage to a rental car, Supplemental Liability Insurance for harms to other drivers, or Personal Accident Insurance for coverage for your own medical bills after an accident in the rented vehicle.
When shopping for car insurance, you can find the best policy for you by comparing prices and coverage options online. For example, you can look for policies that allow you to add supplemental insurance when you go overseas. Comparison shopping online can help you select the car insurance that works for you and your vehicle.