FWIW Mexican Insurance is a scam! Yes, you must have it to go beyond 30 miles or so of the border. It depends on which state. Your US auto insurance works within this distance of the border. If you go beyond, yes you must have Mexican insurance.
For a 6 month policy, I ususally go with Vagabundos del Mar. It is a sailing club but offers auto insurance at a reasonable price.
Not that anyone wants to have an accident, but Mexico is really bad. If you do, people will usually offer you money up front or just drive off. They do not want the cops involved because in many cases, they haul both parties off to jail. They hold you in jail until they have done their own investigation. They wiill issue a ticket to the guilty party and release both parties. It usually takes a few hours but can last a day or two.
I have driven thousands of miles all over Mexico and never had an accident (knock on wood). I have, however met a few that have had minor fender benders. Most the time, the guilty party just drove off. The other times, the police were involved, and both parties were hauled to jail.
But, here is a dilemma. Many of the insurance policies state that you have to have a police report. And, to top it all off, the insurance may not pay for the entire amount of the damage.
Driving in Mexico is not dangerous, per se. Drive slowly and cautiously and by all means, obey the Golden Rule: DO NOT DRIVE AT NIGHT!!! The Chupa Cabra comes out! No, just kidding. At night, the truckers come out in full force and many animals find the warm pavement a comforting place.
Good luck. Have fun. I leave in Feb/March to do the same thing.
