6.1 Personal Auto Policy Structure and Eligibility
Key Takeaways
- The standard form is the ISO Personal Auto Policy PP 00 01, current edition PP 00 01 09 18.
- The six parts are A-Liability, B-Medical Payments, C-Uninsured/Underinsured Motorists, D-Damage to Your Auto, E-Duties After Loss, F-General Provisions.
- "You" means the named insured plus a resident spouse; a "family member" is a blood/marriage/adoption relative resident in the household, including a ward or foster child.
- Eligible vehicles are private passenger autos, pickups, and vans of 10,000 lbs GVW or less not used to deliver goods.
- Newly acquired additional autos must be reported within 14 days (current edition); 30 days is the obsolete edition.
The ISO Personal Auto Policy
The Personal Auto Policy (PAP) is the dominant contract for insuring private passenger vehicles in the United States. The standard form most states test from is the ISO Personal Auto Policy, form PP 00 01, with the PP 00 01 09 18 edition being the current widely used version. Exam questions assume the unendorsed ISO PAP unless they say otherwise. The PAP is written in plain, simplified language and is organized so each coverage stands on its own with its own insuring agreement, exclusions, and limit.
How the policy is assembled
The PAP is built from a declarations page plus the policy form and any endorsements. The declarations (the "dec page") identify the named insured, the described vehicles, the coverages purchased, the limits, the premium, and the policy period. The policy form (PP 00 01) contains the standardized language. Endorsements add, restrict, or modify coverage; common ones include towing and labor (PP 03 03), extended non-owned coverage (PP 03 06), and miscellaneous-type vehicle coverage (PP 03 23) for motorcycles, motor homes, and similar units.
The six standard parts
The PAP is divided into six lettered parts plus a Definitions section and General Provisions. Memorizing the lettering is a frequent exam target.
| Part | Coverage |
|---|---|
| Definitions | Defines key terms (you, your, covered auto, etc.) |
| Part A | Liability Coverage (bodily injury and property damage) |
| 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 |
Parts A, B, and C are the injury/liability portion covered in this unit. Part D (collision and other-than-collision) is covered in a separate unit.
Who is an insured: "you" and "family member"
Under Definitions, "you" and "your" mean the named insured shown in the declarations and the spouse if a resident of the same household. A 2018 edition note: if a spouse leaves the household, the spouse is still treated as a named insured for up to 90 days or until the policy period ends, whichever comes first. A "family member" is a person related to you by blood, marriage, or adoption who is a resident of your household, and this expressly includes a ward or foster child. Family members are insureds even while using a non-owned auto.
Eligibility and "your covered auto"
The PAP is eligible for private passenger autos, pickups, and vans owned by an individual or by a married couple (or, in the 2018 form, owned jointly by other resident relatives or non-relatives). Pickups and vans must have a gross vehicle weight (GVW) of 10,000 pounds or less and not be used for the pickup or delivery of goods (a farm-supply or business-use exception applies for some private use).
"Your covered auto" includes: (1) any vehicle shown in the declarations; (2) a newly acquired auto; (3) a trailer you own; and (4) a temporary substitute vehicle used while a covered auto is out of normal use due to breakdown, repair, servicing, loss, or destruction.
The newly acquired auto trap
Newly acquired autos are heavily tested. The PAP automatically extends coverage to a newly acquired auto, but the rules differ by coverage and whether the car is additional or a replacement:
- Additional auto: liability, med pay, and UM apply automatically, but you must ask the insurer to insure it within 14 days of acquisition.
- Replacement auto: coverage continues automatically; if you want physical damage (Part D), you must ask within 14 days if you carried collision/other-than-collision on the replaced vehicle.
- Physical damage on an additional auto with no existing Part D: you get coverage for 4 days (with a $500 deductible) but must request it within those 4 days.
Trap: the often-quoted "30 days" is the OLD edition. The current PP 00 01 09 18 uses 14 days for the reporting window.
Definitions that drive coverage
Several defined terms are quietly load-bearing. "Occupying" means in, upon, getting in, on, out of, or off a vehicle - a definition that decides Part B and Part C eligibility for someone leaning on or climbing into a car. "Trailer" means a vehicle designed to be pulled by a private passenger auto, pickup, or van, and includes a farm wagon or farm implement while towed.
"Bodily injury" means bodily harm, sickness, or disease, including death. "Property damage" means physical injury to, destruction of, or loss of use of tangible property. Reading these definitions closely is often the difference between two near-identical answer choices on the exam.
The policy period and territory
The PAP covers accidents and losses occurring during the policy period shown in the declarations and within the policy territory: the United States and its territories or possessions, Puerto Rico, and Canada, plus transport between their ports. Mexico is not in the policy territory - a frequently tested gap that drivers crossing the border must cover with a separate Mexican auto policy. The policy period plus territory limits combine with the covered-auto and covered-person definitions to set the outer boundary of every Part A, B, and C promise in this unit.
Under the ISO PP 00 01 09 18 Personal Auto Policy, which part provides Uninsured/Underinsured Motorists coverage?
A policyholder buys a second car (an additional auto) and wants liability coverage to apply automatically. Within how many days must the insured ask the insurer to cover the newly acquired additional auto under the current PAP edition?