Four U.S. carriers provide full coverage in Mexico - Allstate, Farmers, State Farm and AAA to a distance of 75 miles south of the border - typically this means to and including Ensenada. However, Mexico does not recognize this coverage and the visitor must obtain the minimum liability and property damage coverage in order to avoid complications in the event of an accident. You can be detained if you do not have a policy recognized in Mexico at the time of an accident, even if your American policy will cover you.
resource: http://rosaritoinfo.com/directions.htm