Originally Posted by Abby

Do you own and insure a car at home which has liability insurance coverage on it? That liability coverage may also apply to rental cars, check with your insurer. I know that my [Canadian] liability insurance is also applicable to rental cars in the US, and I am pretty sure that I was covered while renting in Mexico (but only rented a car there once, due to the usual concerns).

However, the Mexican car counter will probably try to sell you the liability insurance through their company anyway, and claim that it is the only effective one, etc. or the only one they accept.