Who pays when you’re stranded? Why 18,000 Canadians in Mexico may be stuck with a massive credit card bill

The answer, for many of them, may be: You are.

A situation that's bigger than Puerto Vallarta, Mexico

Mexico is not a fringe destination for Canadians. It's arguably the country's favourite warm-weather escape. A record 2.8 million Canadians visited Mexico in 2025 (2) — making Canada the second-largest source of tourists after the United States.

Puerto Vallarta, Cancún, the Riviera Maya: These are places Canadians fly to in significant numbers every single week of the year, and the popularity of these Mexican destinations has climbed sharply in the last few years. The number of Canadian arrivals to Mexico jumped 11.4% year over year in the first 10 months of 2025 (3), partly driven by a choice to not support U.S. tourism, amid Trump tariffs and an ongoing global trade war. As a result, more Canadians are in Mexico, more often, spending more money — which means more Canadians stand to be caught financially off guard if — and when — things go sideways.

While most people will watch for natural disasters or prepare for a personal health emergency, the current situation in Mexico shows that ‘going sideways’ can extend beyond the expected to the unexpected. In this case, a military operation, a cartel response and a political flashpoint that results in Canadians stranded, looking for a way home.

While the current situation wasn’t an event that many Canadians could have predicted, planned around or prevented, it serves as a reminder that a little bit of emergency planning before you leave Canada can go a long way.

What getting stranded actually costs you

To understand the cost of an unforeseen emergency while travelling, let’s consider what a typical Mexico vacation package costs a Canadian family. Flights, resort accommodation, excursions, travel extras — the average Canadian vacation budget sits around $4,012, according to an Allianz Global Assistance Canada survey conducted by Ipsos (4). For households earning $100K or more, that number climbs to $5,481.

When flights are grounded due to a security event, those costs don't disappear. Extended hotel stays at resort prices, meals outside an all-inclusive plan, rebooked flights, missed connections, emergency transportation — all of it lands on the traveller's credit card even if you have travel insurance. That’s because travel insurance works as a reimbursement, so you must pay for the costs and submit the claim and the receipts to be repaid. And not all costs are covered.

Worse, if the Canadian government's travel advisory escalates to a formal 'avoid all travel' level, many standard travel insurance policies stop paying out entirely (5).

That's a trap that trips up a lot of Canadians, and it matters even if you're not currently sitting on a beach in Mexico.

The coverage gap most Canadians don't know they have

Here's the uncomfortable truth about Canadian travellers and insurance: Many assume they're covered when they're not.

Only 46% of Canadian travellers hold travel insurance (6), and a TD Insurance survey conducted by The Harris Poll Canada in 2025 found that only 51% of Canadians planning domestic travel planned to purchase travel insurance, and just 42% intended to buy emergency travel medical coverage (7).

For international trips, coverage rates are higher, but the policies themselves are riddled with fine print.

Many policies exclude trip interruption coverage if a government travel advisory was already in place before you purchased insurance — and Canada's advisory for Mexico had been sitting at 'exercise a high degree of caution' for some regions long before this week's events. If your policy was written to exclude coverage in those zones, or if the advisory level escalates after the fact, you may be left holding the bill.

Trip interruption insurance — the coverage that kicks in when you're already on your trip and something forces a change of plans — is also frequently overlooked. It's a separate product from trip cancellation insurance (which only covers cancellations before you leave), and many travellers don't know the difference until it's too late (8).

Luggage and personal items left behind

In the chaos of an evacuation or civil unrest, luggage is often the first thing left behind or lost. To help, here are the most common scenarios and coverages.

For instance, if your luggage is stolen or lost during the unrest — perhaps it’s left in the hotel lobby during a hasty departure or taken from a vehicle — then travel insurance that includes ‘baggage and personal effects’ coverage will apply. Most policies offer $500 to $1,000 per person, with ‘per item’ caps (often $300 to $500 for these capped items).

If you carry higher-value items, like a professional camera or a high-end laptop, you’ll want to check your insurance coverage limits. If the per-item is too low, you’ll want to add a rider, which is extra insurance that specifically covers those items. (Keep in mind, though, you’ll pay extra for this added coverage.)

One final consideration is how you report the loss. Insurers often deny claims if bags were left unattended in a public place. However, if they were stolen from a locked hotel room or a secure luggage storage area during the crisis, in general, you should be covered.

If your bags are stuck at an airport (like Puerto Vallarta or Mazatlán) while you are sheltering elsewhere or have been rerouted, then your coverage should cover your costs for purchasing essentials. For most plans, the coverage is limited to $200 to $500 for the purchase of essentials, such as basic toiletries and a change of clothes, but only if your bags are delayed for more than six to 12 hours. Just be sure to keep all your original receipts, as you’ll need to submit to be reimbursed.

If you ‘lose’ your personal belongings or luggage because you had to evacuate and leave them behind, then coverage for your baggage enters a grey area. Some comprehensive plans treat the loss of possessions during a government-ordered evacuation as a covered expense under Trip Interruption or specialized Security Evacuation clauses.

If travel insurance denies the claim, you can claim the loss using your home insurance policy. Most homeowner policies cover the loss or theft of personal belongings even if you are away from home. The deductible is usually higher, and it will count as a claim on your home insurance, but it can offset a large loss if you left behind expensive items.

If documentation, such as a passport or Nexus card, is stolen or lost during an emergency abroad, you can get the costs paid to replace these items covered by your travel insurance. Not only can you claim the cost of the documents, but also travel costs associated with going to the nearest Canadian consulate for help. Coverage is usually capped at $500.

What Canadians can do — before and after booking

The Puerto Vallarta situation is a useful moment to stress-test your own travel financial plan.

Here's where to start: