Insurance for Expats
Insurance has always been a four-letter word in our book... big checks exchanged for nothing visible. At best, it has always seemed like a necessary evil. But when you are moving to a new country, away from familiar situations, insurance becomes even more important than usual. As expats living here in the Yucatan, we've had to deal with three different kinds of insurance which we have felt are critical to our peace of mind. Here's a brief overview of what we have learned about insurance and a few trusted contacts.
When we first drove here from California, we insured ourselves and our car as tourists through Sanborn's, which apparently is NOT related to the famous Sanborn's restaurants. We had no accidents, so no occasion to use the insurance. But we did benefit from the comprehensive Travelog Guidebooks that Sanborn's provided at a discount when you bought their insurance. These days, the maps and information on the Internet are probably more comprehensive, but back then we found the ones from Sanborn's reassuring, if not always accurate.
Auto insurance is probably the easiest insurance to obtain. If you have a US or Canadian vehicle, you should have bought auto insurance when you entered Mexico. There must be a hundred different places advertising themselves on billboards in border towns, not to mention a million more places selling auto insurance on the internet. If you are driving into Mexico, you can buy your car insurance for a day, a month or a year through the internet, print your insurance policy, pay by credit card and you're ready to go.
If you have a car with US or Canadian plates, and you are getting ready to buy or renew your insurance from a local agent here in the Yucatan, you'll be purchasing "tourist" coverage. Don't worry, because that affords you the same three options that someone with Mexican plates has:
- Amplia: Damage to the Car, Theft, Third Part Liability, Medical Expenses, Road Assistance and Legal Expenses
- Limited: All of the above, minus Damage to the car
- 3rd Party Liability: Third part liability, Medical Expenses, Road Assistance and Legal Expenses
Unlike the United States, Mexico does not require auto insurance. However, the driver's liability for an accident is severe (Go to Jail, Go Directly to Jail, Do Not Pass Go, etc.). Because the "jail" option is nothing to mess around with, it makes sense to contract with one of the big insurance companies (GNP, Quálitas, Peninsular) that have good service components (lots of adjusters in small, fast cars that can get to the scene of the accident quickly). Smaller insurance companies or banks are often not able to provide the highest level of service.
We have had one car accident while living here in Mexico (right in front of our favorite taco stand!). At the time, we were insured by ING. After pulling the cars to the side of the road, both parties called their insurance agents. Insurance representatives showed up about a half hour later, inspected the cars and the scene of the accident, talked to all parties involved, gave us forms to sign and left. No one was hurt, though the other party's car had been damaged. Everyone was very friendly, and left amid smiles and handshakes. We had no idea what to expect, and over the next few weeks, kept waiting for a call, expecting to hear that we owed money for something. We never got that call. Apparently, the insurance companies handled the repairs for the other car between them and life went on!
Conversely, we have a friend who arrived here, driving a car from California without insurance. A few months after moving here, he rear-ended another vehicle, damaging both vehicles. He had no insurance and did not have the $8,000 pesos that the police and car owner demanded on the spot for the damage. He was sent to the local jail for eight days. His car was also impounded, and a fine had to be paid after his release in order to retrieve his car. Upon hearing that story, we decided that having car insurance in Mexico is a good idea.
Our loyal readers have certainly read about our adventures in importing our car so that it now has Yucatan license plates. After we accomplished that feat, we drove once into the United States and found ourselves having to buy temporary US insurance for our Yucatecan automobile. Apparently, most people driving into the United States plan on staying there, because we were unable to find a policy that covered us for only a few weeks or a month (which is easy to find when you are driving a US car into Mexico). We ended up contracting for a year with monthly payments, and then cancelling after a month. It was a lot of paperwork and hassle, but small price to pay compared to the hazards of getting caught in the United States without car insurance.
Home insurance in this part of the world comes in two flavors: with or without hurricane coverage. Once you've made that decision, you can also decide to insure your home against damage to contents, damage to the building, theft, civil liabilities (insuring against someone suing you for falling down your stairs...) or for broken glass. Our local insurance agent figures that maybe half the expat residents in Merida own home insurance.
For those who own a home at the beach, however, it is a very different story. For beach residents, home insurance is practically a requirement, and if you are getting a mortgage, it IS a requirement.
Our friend who has a house in Telchac buys yearly home insurance that costs about $2,700 USD a year, covering her for hurricane damage and theft. We are told home insurance without hurricane coverage costs about $850 USD per year. In order to qualify for beach hurricane insurance, our friend had to build a sea wall which extends a certain number of feet below the surface in front of her home. She also had to be at least 50 meters away from the shoreline. If you have a house by the beach that is not on the shoreline, then hurricane coverage is easily obtainable without any further requirements.
One of our local insurance agents, Ricardo Castillo, tells us that most local companies will not write hurricane insurance during hurricane season. Some will make an exception as long as there are no meteorological threats on the horizon at the time. Therefore, if you are buying or own a home on the beach, it is important to secure your hurricane insurance during the winter. Hurricane season runs officially from June 1 to the end of November every year, and while the rule of thumb is that this part of the Yucatan only sees a bad hurricane once every fourteen years, but when one does come, it can be devastating and capricious. In 2002, Hurricane Isidore hit the Yucatan Gulf Coast head on, destroying many houses along the beach. On the same beach, one house was devastated while the one next door was left standing. Those without insurance have often taken years to be rebuilt, and some of them never have been. Once you have purchased hurricane insurance, most companies will renew your policy yearly as long as you have kept up on your payments. Again, it's best to go with large local companies such as GNP or Peninsular that can provide quick response.
The biggest expense for the Working Gringos in the insurance realm is health insurance. We have found that the local doctors charge about $400 pesos for a doctor's visit, and other minor services are equally affordable. But if something catastrophic happens that requires hospitalization, we don't want to be without adequate coverage. When we first moved here, we bought health insurance from GNP through a local agent who spoke a little bit of English. The policy was written in Spanish and we found it very difficult to understand, understandably! We tried to use it once for a minor hospital visit, and after a few attempts at understanding both the policy and the hospital insurance liasion, we gave up.
There is Mexican government insurance available to expats through the Mexican Social Security agency called IMSS, and we have a few friends who are insured this way. Coverage is free for anyone who works for most Mexican corporations, and is available for a low annual fee for everyone else, including expats, as long as they can prove permanent residency (FM2 or FM3 visas). There are two offices in Merida where you can sign up for IMSS. Keep in mind that any paperwork for IMSS will be written in Spanish and anyone you will deal with, from doctors to clerks, will probably not be speaking much or any English either. The costs for IMSS for 2008 are:
- Age: Pesos:
- 0-19 $1,147
- 20-39 1,340
- 40-59 2,003
- 60+ 3,015
Most doctors in Mexico spend some of their time working in IMSS offices, but the IMSS offices are generally more crowded than a private office. We've heard that waiting times can be long, but we've also heard that sometimes you can just walk right in. Certainly, when Working Gringa went for her rabies shots (see Dog Bites Gringa in Merida), there were never any lines in the Preventative Healthcare Office.
IMSS is inexpensive national healthcare, and while it has its downside, it is certainly better than nothing. Our friends who have used the IMSS system here in Merida have been happy with it so far. They have had good care for minor problems, and have saved considerable money on medications, which are free from IMSS if prescribed by a doctor. For more information about signing up with IMSS, we're happy to refer you to a great blog written on the other side of Mexico, that has lots of details: www.rollybrook.com.
Due to the fact that we're over 50 and we can thankfully still afford private health insurance, we were always looking for something better. A few years ago we bought our policy from International Medical Group, an insurance company that specializes in medical insurance for travelers and expatriates. We have been very satisfied with the service, so we're passing on the information on how to obtain similar coverage.
We have formed a loose alliance with an insurance agent, John McGee, who specializes in selling insurance to travelers and expats. That is all he does. He represents a few different companies (including International Medical Group) that provide the kind of health, life and other insurance that we need, which include various riders and features necessary for the peace of mind of someone far from home. One of the companies he represents is HCC International, the holding company for MultiNational Underwriters, whose insurance is backed by Lloyd's of London. You can check them here yourself. All their financial statements are on their website, as well as updates and press releases from their management. All of John's clients are overseas, and he has an assortment of policies for the different needs of expatriates. For instance, his preferred carrier, MultiNational Underwriters, will provide coverage for a client's entire lifetime if they purchase health insurance before the age of 64. If they purchase after the age of 64, coverage is only provided until they reach 74. Since this may not be acceptable to some people, he has other carriers that will charge more, but will provide a client's lifetime health coverage, even if they bought after age 64.
While we haven't had any major health problems, Working Gringa did fall and hurt her ankle badly awhile ago. The entire cost of the emergency room care, including X-Rays and a cast for her ankle, was about $900 pesos (or $90 USD at the time). We sent in our claim to IMG, more as an exercise than anything else, to see what they would do. We were surprised to receive a check for $67 USD a few weeks later, with no further questions or demands for additional documentation. What we also appreciate about this policy is that we are covered not only here in Mexico for anything involving hospitalization, but we are also covered anywhere else in the world, including the United States and Europe.
The carrier, MultiNational Underwriters, makes available two levels of insurance: Citizen's Secure Benefits and Citizen's Secure Economy. Though both programs offer the freedom to choose any doctor or hopital in the world, the main difference is that the Citizen's Secure Benefits has a larger payout if you find yourself in a hospital in the US or Canada. For instance, the Citizen's Secure Benefits covers what is "usual, reasonable and customary" for a stay in the intensive care unit of the hospital wherever you end up. If this is in the United States, a day in intensive care can run into multiple thousands of dollars. With the Citizen's Secure Economy policy, there is a cap of $1,500 USD per day, which will probably cover a day in intensive care in Mexico, but may not make a dent if you are hospitalized in the United States. Both policies cover maternity, and you can also buy a Sports Rider if you tend to indulge in sports like scuba diving or sky diving. Finally, one other very important option included is many of John's policies is the Air Evacuation benefit. This benefit will pay for you to fly you to the United States or the closest medical facility that can perform life-saving procedures from open heart surgeries to organ transplants. Even though Mexico's medical facilities continue to improve, and there are world-class facilities in Merida, we like knowing that our policy covers us for treatment in a US hospital if we need it.
Now, granted, we haven't had to test the outer limits of our policy, but we sleep better at night knowing that the people who write these policies have done their research and are writing them especially for people like us, and that our agent is educated in the unique needs of an expat client.
What does it cost? Well, of course, costs vary depending on your age and pre-existing conditions. For the Working Gringos, who are in our early 50's, the cost is about $1400 USD apiece per year. Of course, there is an option to pay monthly or quarterly as well. The requirement for most of these policies is that you must be living outside the United States when you get the insurance, and must be planning to live outside the United States for six months hence.
While we're sure that we were adequately insured when we bought our policy from GNP here in Merida, we paid almost $500 USD apiece for coverage similar to what we have now. But the entire package of documents was written in Spanish, making it very difficult for us to understand our policy and therefore, obtain any of our benefits. If we had known about the policy available for expats that we have now, we certainly would have bought that from the beginning.
Here is the contact information for insurance agents that we have used here in Merida and in whom we trust for the insurance we have mentioned above.
John McGee, Expat Global Medical Agency
US Phone: 1-336-998-9583
John speaks English and all policies are written in English. John sells Health and Life Insurance specifically designed for travelers and expats. Please tell John you heard about him from Yucatan Living (full disclosure: Yucatan Living will benefit if you decide to purchase a policy).
Francisco Encalada Flores
Merida Phone: 999-928-1187
Francisco has written our two auto insurance policies, and has obtained hurricane insurance for our friend with a house in Telchac. He does NOT speak English, but is used to dealing with the needs of expats. He works as an agent for the local agency, La Peninsular Seguros.
Ricardo Castilla Sosa, CARSA
Merida Phone: 999-944-4999
Ricardo speaks some English and sells Car, House, Health and Life insurance. He provided much of the background information for this article.
The two offices to sign up for IMSS in Merida are located here:
Subdelegación Mérida Norte,
Calle 7 No.131 x 38,
Col. Pensiones C.P. 97217
Directions: From the Centro, go North on Calle 60 past the hotel zone. At the traffice circle, follow the signs to Mega Grocery Store, and turn left on Avenida Itzaes. When you come to the Chevrolet dealer (on your right), turn right at the stoplight beyond the dealer. The IMSS complex is about three blocks ahead on your right.
Subdelegación Mérida Sur,
Calle 131 No.999 x 42 Sur,
Col. Serapio Rendón C.P. 97285
Directions: Go south on Calle 42 to Calle 131 and the IMSS office will be on the corner.
Note: You can sign up for IMSS insurance at either office. Upon acceptance into the program, IMSS will assign you to a local clinic close to your residence.
We welcome your comments below with other suggestions or additional information on this subject.