So, you have bought, or are about to buy, a property in Mexico; so it’s time to think about insurance and how you can best protect your investment from all kinds of risks, both natural and man-made. Almost all residential structures in Mexico will be suitable for an “all risk” or “named risk” insurance which covers them from a number of natural and human threats.
Insuring your property in Mexico
This is key because Mexico is much more prone to floods, earthquakes, and severe hurricanes than you may be used to This is why Mexican insurers have access to huge amounts of topographical, historical, and meteorological data; it makes it possible for them to assess which areas are at most risk of certain natural disasters and events, and allows them to calculate premiums based on this. This means that they are also able to offer appropriate levels of insurance cover to homeowners depending upon their area and the costs of repairs, and rebuilds. Insuring your property in Mexico is therefore highly recommended.
Can all property be insured?
While it is possible to insure most property in Mexico there are some notable exceptions. Below you will find a list of some of the restrictions.
Untitled Property: Property built on common land can pose a real problem when insuring your property in Mexico. Common land (known as Ejido) can only change hands under agrarian terms. This means that while the buyer gains possession they do not, nor will they over, hold the title deed, and as such any structure on the property becomes uninsurable under Mexican civil law. Upon the event of any claim the insurer will require to see the title deed, not just proof of possession. This is equally the case of any property that doesn’t not have its paperwork in order. A notary is the best place to go if you are in any doubt about the deeds to your property.
Palapas: Some homes in Mexico feature elaborate, open air structures built primarily of wood, bamboo, and palm leaves; these beautiful buildings are called Palapas, and can be stand alone, or act as annexes to rooftop gardens and other terraces around the home. Unfortunately, due to their notorious vulnerability to fire and other elemental forces they are uninsurable, and will be excluded in the small print of any coverage. You may be able to cover them as a special addition but must check with your insurance company prior to insuring your property in Mexico.
Commercial property: property that is used for both residential and commercial purposes (excluding a simple home office, of course) requires insurance from a specialized broker who is authorized to offer cover in this field. If you rent out part of your home, too, (known as “simultaneous occupancy”) you will need this specialized insurance. These policies are more complicated and expensive than residential insurance policies, but are well worth the money as they provide excellent coverage under a number of situations not covered by residential insurance.
What is your experience of insuring property in Mexico as an Expat? Please share your ideas in the comments box.