MEXICO Law and Practice Contributed by: Carlos de la Garza, Raúl Acosta and Enrique Tamez, De la Garza & Acosta Abogados, S.C.
For insurers, early co-ordination with the insured and defence counsel is therefore increasingly important in significant claims. Clear agreement on defence strat- egy, expert appointments, reporting and cost control can reduce duplication and unnecessary expenditure, while policy wording remains critical in determining whether and to what extent defence costs are covered and how they interact with applicable liability limits. 5.4 Cost Risk Management and Funding Solutions Insurance and Fee Arrangements Litigation cost risk is commonly managed through lia- bility, professional indemnity or D&O policies providing defence costs, subject to policy limits and provisions governing appointment of counsel. On the claimant side, contingency arrangements are common. Lawyers may bear their own fees and, in some cases, certain litigation expenses in exchange for a substantial percentage of any recovery, reducing the claimant’s immediate cost of litigation. Third-Party Funding Institutional third-party litigation funding is permis- sible but remains relatively uncommon in domestic court proceedings and is more frequently considered in arbitration or high-value commercial disputes. After-the-event insurance is likewise not widely used in Mexico. 5.5 AI-Driven Claims Volumes and Complaints Current Position There is not yet reliable evidence that AI-generated or AI-assisted claims are materially increasing insurance claims or complaint volumes in Mexico. Although AI tools are becoming increasingly accessible to poli- cyholders, claims advisers and legal practitioners, available claims data does not currently distinguish complaints prepared with AI assistance from those prepared through traditional means. Potential Impact This may nevertheless become significant in the com- ing years. Generative AI can substantially reduce the time and cost involved in preparing insurance claims, complaints before insurers or CONDUSEF and, ulti- mately, court proceedings. This may facilitate a great-
er volume of claims and increasingly detailed submis- sions, including standardised or repetitive arguments that require individual assessment. For insurers, the principal challenge will be distin- guishing efficiently between well-founded claims and submissions that are extensive but technically or evi- dentially weak. AI-assisted documentation may also increase the importance of verifying the authenticity, consistency and provenance of evidence submitted in support of a claim. Accordingly, insurers are likely to require increasingly sophisticated claims-triage systems while maintaining meaningful human review, particularly where cover- age decisions depend on medical, technical or factual evidence. 6. Third-Party Claims and Defence Trends 6.1 Third-Party Claims and Direct Actions Direct Actions Against Insurers Direct actions by injured third parties are well estab- lished in Mexican insurance law. Under Article 147 of the LCS, liability insurance grants the injured third par- ty a direct right to indemnification against the insurer, and the third party is treated as a beneficiary of the insurance from the moment of the loss. The third party is not required to obtain a prior judg- ment establishing the insured’s liability before pursu- ing the insurer directly. The underlying liability of the insured must nevertheless be established within the proceedings, since the insurer’s obligation remains dependent on the existence of covered liability. Direct actions are most commonly seen in motor and transport liability and other casualty claims involving bodily injury, death or property damage. Recent Developments Recent Supreme Court jurisprudence has reinforced the practical position of third-party claimants. In par- ticular, the Court held that, where liability insurance covers the death of a third party, the applicable limi- tation period is five years rather than the two-year
186 I NSURANCE L I T IGATI O N 2026
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