Liability exposure in Mexico is lower than in the United States because the limits on damages other than actual damages such as punitive or "moral" damages are much lower or do not exist at all in the former. In case an automobile accident occurs, liability in Mexico is divided into two components. The first one constitutes actual damages which are based on the actual value of the other party's automobile, property, medical expenses, and/or loss of wages. The second component is "moral damages" which are more or less similar to the U.S. concept of pain and suffering and which in most Mexican states is only a fraction (in most cases a third) of the actual damages. In recent times, however, some states, especially the Federal District DF and the state of Chihuahua have adopted a new precedent by permitting a judge to set damages at his/her discretion, based on the surrounding facts of the case. .

In Mexico, liability cases may be tried under either Mexican civil or criminal law. Criminal liability is different from civil liability in the sense that damages in a criminal case may not be subject to the limits which are found to exist in a civil liability case. In addition, an accident victim does not need to appoint a lawyer to seek damages in a criminal case; it is the responsibility of the public prosecutor to hire the lawyer. Because of these two factors, it is much better to ask for damages as a criminal case rather than a civil case.

In some Mexican states like the D.F. and Chihuahua, verdicts on damages are getting almost as severe as are usually found in the United States. However, many states including Baja California, still continue to be very lenient in terms of liability exposure. If there occurs an accident in Baja California in which you are at fault and there is a fatality involved, the damages you may be liable for are: damage to the other party's vehicle, in most cases limited to actual cash value of the vehicle at the time of the accident; damage to any other property, such as other vehicles; medical expenses (including hospitalization, medication, ambulance etc., that seem to be much less expensive than in the United States); funeral expenses; economic damages for wrongful death (these are basically based on the U.S. notion of loss of wage, amounting to $5110 in Baja for instance); and moral damages which are no greater than 1/3 of the total physical, medical, and economic damages. This is why proper Auto Insurance for Mexico tourists is very important.

Although liability exposure is still lower in Mexico than in the U.S., the scenario is changing steadily. The recent trend in Mexico is towards more discretionary limits imposed on a case by case basis as has been observed in states such as the D.F. and Chihuahua. In terms of insurance coverage, even though the costs for judgments may be less in Mexico than what we are familiar with in the United States, it is still very crucial to have adequate coverage.


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