Will Your Auto Insurance Policy Cover You Overseas?

When shopping for an auto insurance policy in the United States, little thought is given to international coverage. While laws may vary from state to state, you can rest assured that you will be covered anywhere you drive in the United States. But what if you travel abroad?

Whether you’re driving in Canada, England or somewhere in between, it’s important to understand the extent of your coverage (if any) and how to protect yourself. Failure to obtain the proper coverage will leave you vulnerable to liability claims.

Insurance and Rental Cars Overseas

If you purchase an insurance policy in the United States, your policy will not cover you when driving a rental car overseas. Unless you plan to have your vehicle shipped overseas, you will need to purchase insurance coverage when renting the vehicle.

In many cases, credit card companies provide insurance coverage on rental cars, even when renting overseas. You’ll need to check with your credit card company and the details of your account to find out if this coverage is available to you.

Each country has its own set of rental insurance requirements. Do your research beforehand to learn more about these requirements and find out if you’re already covered through your credit card company. If you are covered by your credit card, there may be no need to purchase additional insurance through the rental agency.

If you opt for the coverage offered by your credit card company, you’ll want to get a “letter of eligibility” to present to the rental agency. While not required, it will reassure the agency that you are covered and keep the agent from pressuring you into buying insurance that will nullify your credit card coverage.

While laws and rules vary from one country to the next, you’ll want to make sure that you’re covered for:

  • Injuries to you and other passengers
  • Physical damage to the rental car
  • Injuries and damages to other drivers and their property (if you’re the one at fault)

When traveling abroad and renting a car, it’s best to get coverage through a local provider.

Traveling to Canada and Mexico

What if you’re crossing the border into Canada or Mexico? Will your auto insurance policy cover you?

Policy minimums will be different in Canada. In Ontario, for example, drivers are required to have an auto insurance policy with at least $200,000 in third-party liability. But generally, most American auto insurance policies will cover drivers traveling into Canada.

If you’re planning a road trip to Canada, call your insurance company first to make sure that your coverage goes with you. Your insurance company may send you a temporary Canadian insurance card to serve as proof of coverage while you’re traveling.

If you’re renting a car in Canada, your auto insurance policy may still cover you. Again, be sure to call your provider to inquire about rentals in Canada.

Many insurance providers only offer limited coverage to those traveling into Mexico. Talk to your insurer to find out if you’re covered and for how much. Mexico has some of the strictest driving and auto insurance regulations in the world. U.S. policies are typically not valid once you cross the border.

If you’re driving in Mexico, even for a short time, you’ll likely need to purchase a Mexico auto policy. If you get into an accident and don’t have coverage, there’s a good chance that you’ll end up in jail.