Well, partially true. If you plan on riding on any federal road, highway, whatever, you are obligated by law to be carrying insurance. However, there are exceptions to this with state roads, things can vary state to state. A lot.
Having said that, it is very likely that if you checked people using federal highways, probably fewer than 3/4's will have valid insurance.
So why carry insurance if even residents of the country don't?
How important is it for you to continue on your trip hassle free and not having problems? How important is it for you to not have to risk hiring an attorney in a country where you likely are not fluent enough in the language to even begin to understand legal terminology not to mention the legal system?
Personally, since I live here and ride here and have done so for more than two decades, I carry everything I need by law, my insurance also has my medical policy, I enjoy the amparo I will have when I need it. And if you have to google "amparo" just buy the insurance, because you don't know the first thing about the legal system here.
Most of all, I carry insurance to also protect the people I am riding with. I don't ride with uninsured riders, the hassle is not worth it. If you have ever had to contact any authorities here for an accident, especially one with injuries, you do not want the added headaches of having to deal with things yourself and not with the immediate assistance of a good lawyer.
If I damage someone's property, I pay. But if a visiting rider or a local rider without insurance damages my property, I have to sue. See the problem?
Not worth the hassle.
Importantly, there has been some controversy about whether or not the new much higher liability award limits are valid, or have been put to the test legally, and certain agencies in the US are claiming you don't need to respect the new higher liability award limits when you buy insurance. My take on this is...why risk it and become the first example? The new liability award limits are much higher than before, but do you have the financial resources to pay them?
You might be thinking how much damage can you do with your bike? Well, think of a scenario where you have been found to be at fault for a car with a family inside it having an accident with injuries or death. Don't think about whether you are guilty or not, think about if you have been found to be at fault by the investigating authority. Can you get yourself out of the legal maze you will find yourself in? Or will you need bonafide professional help? If you have ever seen the Mexican "justice" system "at work", you will know what I mean. And forget calling your embassy. Just ask a currently jailed US Marine how good the list of attorneys was for him.
Bottom line, the choice is yours. I choose to be legal and have the peace of mind. But then again, I ride here much more than any visitor ever will.
My bike is my transportation.

Problem in Mexico - and some other countries - is if you do have an accident and can't produce documentation showing insurance and legal cover, you may spend some time in prison waiting for it to be resolved.In some countries it is illegal to move a vehicle that has been involved in an accident until the police have dealt with it so sneaking away is probably not an option because there will always be eyewitnesses to stop you. In Morocco we sat on a desert road for two hours while two taxi drivers argued over a minor scrape going around a blind corner and they was no way they were going to move even a foot (which was all we needed to get past) until the police turned up.

If countries refused to let you cross the border until you purchased liability insurance, there would never be any problems, but most don't care because it is a private matter between you and your insurer or the one you injure (or as is often the case, a good way for the police to extract some pocket money). Mexico apparently never asks for proof of insurance - motorhomers anyway - but you would be silly not to take it out..

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Tony
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Thanks guys but has to be said there is no way I plan on going anywhere without the proper paperwork. I have found a dealer in orlando that is going to help me with an addres for the registration of the bike and insurance

Awesome. Have a great ride!!!

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