3.1 PAP Structure & Definitions

How the PAP Is Organized

The Personal Auto Policy (PAP) is the ISO contract most personal-lines exams test verbatim. The current edition is form PP 00 01 09 18 (filed September 2018). It is an open-perils liability and physical-damage contract assembled in a fixed order:

1. Declarations page — names the insureds, vehicles, coverages purchased, limits, deductibles, premium, and policy period. It is the only personalized page; everything else is preprinted.
2. Definitions section — defines terms shown in quotation marks throughout the form, including you, family member, your covered auto, occupying, and property damage. On the exam, a quoted term always carries its policy definition, never its everyday meaning.
3. Six lettered Parts:
   • Part A — Liability Coverage
   • Part B — Medical Payments Coverage
   • Part C — Uninsured/Underinsured Motorists Coverage
   • Part D — Coverage for Damage to Your Auto (physical damage)
   • Part E — Duties After an Accident or Loss
   • Part F — General Provisions
4. Endorsements — add or modify coverage: towing and labor (PP 03 03), extended non-owned coverage, miscellaneous-type vehicle (motorcycle/RV) PP 03 23, and mandatory state amendatory endorsements.

Who Is 'You'

• The named insured shown on the Declarations.
• The resident spouse — the spouse of the named insured living in the same household.
• If the spouse moves out, coverage continues for that spouse for up to 90 days, or until they are named on another policy, whichever comes first. This 90-day bridge is a common exam detail.

Who Is a 'Family Member'

A person related to you by blood, marriage, or adoption who is a resident of your household, expressly including a ward or foster child. Residency, not age, is the test:

• A college student living in a dorm is generally still a resident of the parents' household and remains a family member.
• An adult child who has established an independent, permanent residence is not a family member.
• An unrelated roommate or a live-in partner who is not a spouse is never a family member, regardless of how long they live there.

'Your Covered Auto'

The newly acquired auto rule is heavily tested. A replacement vehicle steps directly into the coverage of the car it replaces, so a trade-in carrying only liability gives the new car only liability. An additional vehicle (you kept the old one) gets the broadest coverage on the policy, but Part D physical damage applies only if you report it within the 4- or 14-day window described above.

Eligibility

To be written on the ISO PAP, a vehicle must satisfy all of the following:

• Four wheels — motorcycles, mopeds, and three-wheelers are excluded and need a miscellaneous-type vehicle endorsement or a separate policy.
• Gross vehicle weight (GVW) of 10,000 pounds or less — heavier trucks require a commercial Business Auto Policy.
• Private passenger use — pickups and vans up to 10,000 lbs GVW qualify only when not used for delivery or commercial purposes (incidental business use is acceptable).
• Individually owned — a vehicle titled to a corporation or LLC needs a Business Auto Policy, even if a sole member drives it personally.
• No public or livery use — carrying persons or property for a fee (taxi, Uber, Lyft, food delivery) is excluded without a ridesharing endorsement.

Common trap: the exam will offer a 12,000-lb pickup or an LLC-titled sedan as 'eligible.' Both fail — weight and ownership are absolute screens before any coverage discussion begins.

Worked Example: Newly Acquired Auto

Suppose a policyholder owns one car insured for liability and Other Than Collision (OTC) but no Collision, and on Monday she buys a second car (keeping the first). Because OTC already applies to at least one auto on the policy, she has 14 days to add the new car and receive the broadest OTC and liability on the policy. If, instead, her existing policy carried only liability with no OTC on any auto, the window shrinks to 4 days, and Part D physical damage would not attach until she actually requested it.

Now change the facts so the new car replaces the old one: the replacement car steps into the exact coverage of the traded-in car, so a liability-only trade-in produces a liability-only replacement, with no Collision or OTC unless she asks for it. Memorize the distinction: additional auto = broadest coverage with a reporting window; replacement auto = inherits the trade-in's coverage.

Why Definitions Drive Every Question

Because each coverage Part begins by naming who is an 'insured' and what is 'your covered auto,' a question that looks like a coverage problem is often really a definitions problem. If the person hurt is not a 'you' or a 'family member,' Part B may not reach them in a borrowed car; if the vehicle is not 'your covered auto,' the broad permissive-user grant in Part A never engages. Always classify the person and the vehicle against the Definitions section first, then read the coverage Part.

This habit alone resolves a large share of personal-auto exam items, which is why mastering Section 3.1 is non-negotiable before moving to the coverage Parts.