In 2023, the U.S.’s top trading partner was Mexico. That trend is continuing well into 2024, with the increased volume resulting in growing pains that have been thrust front and center on both sides of the border.
Some of the common challenges with cross-border freight are visibility, track and trace operations, cargo theft, safety, insurance coverage, and wait times at the border.
According to BSI Consulting, Mexico is now the highest-risk country in the world for cargo truck hijacking. Data from Reliance Partners’ Cargo Truck Hijacking Portal shows that reported hijackings logged by Mexico’s federal government increased by 3% in 2023.
Mark Vickers, executive vice president and head of international logistics at Reliance Partners, has highlighted the importance of Mexican cargo insurance. “It is crucial for companies to align their cross-border freight cargo insurance with a provider based in the U.S. as opposed to relying on a Mexican-based insurance company. Claims should be resolved in the U.S.,” he explained.
The two major differences between cargo policies in the U.S. and Mexico are that liability insurance is more lenient in Mexico and liability amounts there are lower.
In the United States, liability insurance is required for anyone wishing to transport cargo within the country. Mexico, however, has a chronically low motor carrier liability insurance requirement. On a shipment weighing 40,000 pounds, the Mexican carrier will only be on the hook for a maximum of around $1,250, which is pennies compared to the actual load value of the cargo. The average value of a full truckload shipment moving across the border is $60,000-$130,000. In addition, Mexican trucking companies are only liable for the damage they cause through negligence.
Vickers adds: “We have read the details in all of the top cargo insurance policies in Mexico that are issued in Mexico and the U.S. The number of exclusions in these Mexican policies coupled with the robust documentation collection process when filing claims simply gives the insurance companies too many ways out of paying claims. Many of the U.S.-issued Mexico cargo insurance policies do not take into consideration that Mexico motor carriers do not have cargo insurance, so they require the carriers to have $100,000 in motor truck cargo insurance. When a claim arises, the insurance company quickly points to the fact that these motor carriers are not compliant and that the claim will not be covered. Furthermore, if no cargo insurance is in place in Mexico, the shipper, broker and carrier will point fingers at each other until they finally agree on who will pay for it (even if a waiver of liability is signed). This is a terrible way for partners to work together and conduct cross-border transportation business. It’s an outrage, so we created Borderless Coverage.”
Borderless Coverage tackles the daunting task of ensuring that shippers, carriers or freight brokers maintain and verify Mexican cargo insurance for providers in the U.S. Some companies don’t have the ability to maintain policies in both countries, but Borderless Coverage has access to multiple U.S. underwriters that will take on cargo insurance risk in Mexico.
With Borderless Coverage, Vickers says, “In the event of a claim, the check is cut immediately to the shipper, then the Reliance team will attempt to subrogate against the motor carrier’s insurance after. If the claim occurs in the U.S., Reliance will most likely be able to subrogate against the $100,000 in motor truck cargo. In Mexico, Reliance is not going to get anything back and the policies and pricing account for this. This is important because the shipper needs capacity from its brokers and carriers. Conversely, the carriers and brokers have significant assets allocated to their shipper contracts. None of these parties can halt trade because of the volume that moves across the border. Still, shipments are held hostage and shippers withhold payments to their vendors. To the shippers that say they self-insure, I encourage them to review their deductible, which is more than likely around $100,000.” Borderless solves these issues for the cross-border supply chain.
Cross-border freight is only expected to grow as shippers nearshore more manufacturing facilities in Mexico and begin to export those goods into the U.S. For those looking to shore up cross-border operations or understand what to look for in a potential partner or relationship in Mexico, Reliance Partners is hosting the Reliance Partners’ 8th Annual Modernization of Cross Border Trade event in Laredo, Texas, on June 17, 2025.
Vickers serves as the company’s expert in cross-border insurance. He said the event will highlight some of the following topics:
- What to expect from the 2026 United States-Mexico-Canada Agreement review upon the election of President Donald Trump and Mexican President Claudia Sheinbaum.
- How and when to leverage cross-border warehouse space.
- What cross-border investment firms are looking at in 2025.
- Cross-border partner vetting.
- Practical technology for cross-border in 2025.
- Customs – U.S.-Mexico customs brokerage panel with Customs and Border Protection.
The event in 2024 had speakers from the Texas Trucking Association, Coyote Logistics, Schneider, Echo and C.H. Robinson, to name a few.
Those looking to get involved in the event can reach out to Vickers via email or on LinkedIn.