Policy guide · 10 min read

Personal Auto Policy Explained: Parts A to F of the ISO PAP

Personal auto policy explained for adjusters: ISO PAP Parts A to F, key definitions, split limits, UM, collision vs other than collision, and TX and FL rules.

The ISO Personal Auto Policy (PAP) is the standard form that many U.S. auto insurers use or model their own policies on, and it is organized into six parts: liability, medical payments, uninsured motorists, physical damage, duties after a loss, and general provisions. This guide reads the current 2018 edition (PP 00 01 09 18), flags where the older 2005 edition (PP 00 01 01 05) differs, and shows how state laws such as Texas PIP and Florida no-fault change the picture.

Always work from the actual policy on the file: many carriers use their own forms, and state amendatory endorsements often override the ISO wording.

How the PAP is organized

Part	Title	What it does
A	Liability Coverage	Bodily injury and property damage the insured is legally liable for, plus defense
B	Medical Payments Coverage	Medical and funeral expenses regardless of fault
C	Uninsured Motorists Coverage	Injury damages the insured could recover from an uninsured driver
D	Coverage for Damage to Your Auto	Collision and Other Than Collision physical damage, plus transportation expenses
E	Duties After an Accident or Loss	Notice, cooperation, statements and proof of loss
F	General Provisions	Territory, policy period, termination, subrogation and fraud

Key definitions adjusters check first

“You” and “your”: the named insured and a resident spouse. A spouse who moves out stays “you” only until the earliest of 90 days after the move, the start of another policy naming the spouse, or the end of the policy period.
Family member: a person related to the named insured by blood, marriage or adoption who lives in the household, including a ward or foster child.
Your covered auto: any vehicle on the declarations, a newly acquired auto, any trailer you own, and a non-owned auto or trailer used as a temporary substitute while a covered vehicle is out of use for breakdown, repair, servicing, loss or destruction. The temporary substitute part does not apply to Part D.
Occupying: in, upon, or getting in, on, out or off a vehicle.

Newly acquired autos: 2018 vs 2005

A newly acquired auto is a private passenger auto, or a pickup or van of 10,000 pounds GVWR or less that no other policy covers and that is not used to deliver goods (farming, ranching and incidental use by businesses that install or repair furnishings or equipment are excepted).

Coverage	2018 rule (PP 00 01 09 18)
Liability, Med Pay, UM	Broadest coverage on any declared vehicle, but only if you ask the insurer within 14 days of becoming the owner. This applies to replacement and additional vehicles alike.
Collision or Other Than Collision, when that coverage is on at least one declared auto	Starts on the date of ownership if you ask within 14 days
Collision or Other Than Collision, when no declared auto has it	You must ask within four days. A loss before you ask carries a $500 deductible.
Any request made late	Coverage starts on the day you ask

The key change: the 2005 edition covered a replacement vehicle automatically. Under the 2018 edition, an insured who waits more than 14 days to report a replacement car has no liability coverage on it until the call.

Part A: Liability coverage

The insurer pays bodily injury and property damage an insured is legally responsible for because of an auto accident, including prejudgment interest. Defense costs are paid in addition to the limit, but the duty to defend ends once the limit is used up by judgments or settlements.

Insureds include you and family members for any auto or trailer, anyone using your covered auto, and a person or organization (such as an employer) for its legal responsibility for an insured’s driving. When the vehicle is not your covered auto, that extension applies only if the organization does not own or hire it.

Split limits vs a combined single limit

Split limits are written as three numbers. A 25/50/25 policy means:

Number	Limit	Applies to
25	$25,000	Bodily injury to any one person
50	$50,000	All bodily injury in one accident
25	$25,000	All property damage in one accident

Worked example. A 25/50/25 driver injures three people ($40,000, $12,000 and $18,000) and damages a car ($31,000). The per-person cap cuts the first claim to $25,000, so bodily injury totals $25,000 + $12,000 + $18,000 = $55,000, which the $50,000 each-accident limit then caps. Property damage stops at $25,000. The insurer pays $75,000 and the driver is personally exposed to the remaining $26,000.

A combined single limit (endorsement PP 03 09) is one per-accident amount for bodily injury and property damage together, with no per-person cap. Neither type grows with the number of insureds, claims or vehicles.

Supplementary payments (2018 amounts)

Paid in addition to the limit: up to $250 for bail bonds after a covered accident; premiums on appeal bonds and bonds to release attachments; post-judgment interest until the insurer offers its share; up to $250 a day for lost earnings (not other income) when attending hearings or trials at the insurer’s request (the 2005 edition paid $200); and other reasonable expenses the insurer requests.

Out of state and other insurance. If an accident happens in a state whose financial responsibility law requires higher limits, the policy provides them. Coverage for a vehicle the insured does not own, including a temporary substitute, is excess over other collectible insurance.

Exclusions worth knowing cold

Intentional injury or damage
Property owned or being transported by the insured, or rented to, used by or in the care of the insured (except a residence or private garage)
Injury to the insured’s employee at work (domestic employees are covered unless workers compensation applies)
Public or livery conveyance, which in 2018 includes any time the insured is logged into a rideshare app as a driver, passenger or not. Share-the-expense car pools and volunteer or charitable use are not excluded.
People in the auto business (selling, repairing, servicing, storing or parking vehicles, including road tests), except you, family members and your agents or employees using your covered auto
Using a vehicle without a reasonable belief of being entitled to do so
Your covered auto while used by others through a personal vehicle sharing program
Vehicles with fewer than four wheels or designed mainly for off-road use (exceptions: medical emergencies, trailers and non-owned golf carts)
Vehicles inside a racing facility for racing, speed contests or driver skill training (the 2005 wording did not mention skill training)

For rideshare claims, the whole time a driver is logged into the app belongs to the platform’s insurance or other coverage arranged for that use, and the same exclusion appears in Parts B, C and D.

Part B: Medical payments

Part B pays reasonable medical and funeral expenses for services rendered within three years of the accident, regardless of fault. Insureds are you and family members while occupying, or struck as a pedestrian by, a vehicle designed mainly for public roads, plus anyone occupying your covered auto.

The limit applies per person. With a $5,000 limit and bills of $7,500, $2,000 and $4,000 for three occupants, Part B pays $5,000 + $2,000 + $4,000 = $11,000. Exclusions include injuries on motorized vehicles with fewer than four wheels, rideshare use, and injuries in the course of employment when workers compensation is required or available.

Part C: Uninsured and underinsured motorists

Part C pays bodily injury damages an insured is legally entitled to recover from the owner or operator of an uninsured motor vehicle, meaning one that:

Has no bodily injury liability coverage
Carries limits below the financial responsibility minimum of the state where your covered auto is principally garaged
Is an unidentified hit-and-run vehicle that actually hits the insured, the vehicle the insured occupies, or your covered auto
Has an insurer that denies coverage or is or becomes insolvent

Government-owned vehicles and vehicles furnished for your regular use do not count. A driver carrying exactly the state minimum is not uninsured, so the shortfall needs underinsured motorists coverage (endorsement PP 03 11). UM arbitration requires both sides to agree and never decides coverage. The policy’s anti-stacking wording limits payment to one limit regardless of vehicles or premiums, but some states override it.

Part D: Coverage for damage to your auto

Part D pays for direct and accidental loss to your covered auto or a non-owned auto, minus the deductible. Collision is the upset of the vehicle or its impact with another vehicle or object. The right column is Other Than Collision (often called comprehensive), even when it involves an impact.

Collision	Other Than Collision
Hitting another vehicle	Missiles or falling objects
Hitting a pole, guardrail or other object	Fire; explosion or earthquake
Rollover (upset)	Theft or larceny
	Windstorm; hail, water or flood
	Malicious mischief or vandalism; riot or civil commotion
	Contact with a bird or animal
	Glass breakage

Glass broken in a collision may be treated as part of the collision loss, so only one deductible applies.

Transportation expenses

Item	2018 edition
Daily cap	$30 per day (the 2005 edition paid $20)
Maximum	$900, with no deductible
Total theft	Payable from 48 hours after the theft until the car is returned or the loss is paid
Other covered losses	Payable once the car is out of use for more than 24 hours, for the time reasonably needed to repair or replace it

Example: a stolen car is returned 12 days after the theft while the insured rents at $45 a day. Ten days are payable after the 48-hour wait, at $30: $300. Endorsement PP 03 02 buys higher limits.

Part D exclusions

Rideshare use; wear and tear, freezing, mechanical breakdown and road damage to tires (unless from a total theft); electronics that are not permanently installed; custom equipment above $1,500; radar detectors; government confiscation; and racing facilities. Electronics installed where the manufacturer did not put them are capped at $1,000.

Total loss, ACV and settlement

The insurer pays the lesser of actual cash value or the cost to repair or replace with property of like kind and quality, and it does not pay for betterment. In a total loss, ACV is the pre-loss market value of comparable vehicles, adjusted for depreciation and condition. A cash payment includes applicable sales tax.

States decide when a car is a total loss: some compare repair cost plus salvage value with ACV, others use a percentage threshold. If an owner keeps a totaled car worth $10,000 with $1,800 salvage value and a $500 deductible, the payment is $10,000 minus $500 minus $1,800, or $7,700. Try your own numbers in the actual cash value calculator. Disputes over the amount go to appraisal, with an umpire breaking ties.

Part E: Duties after an accident or loss

The insurer needs prompt notice of how, when and where the loss happened, with injured persons and witnesses. Anyone seeking coverage must cooperate, forward legal papers, submit to physical exams, examinations under oath and (new in 2018) recorded statements, authorize records, and file a proof of loss when asked. A breach defeats coverage only if it prejudices the insurer. UM claimants must report a hit-and-run to police; Part D claimants must protect the car from further loss, report a theft, and allow inspection before repair or disposal.

Part F: General provisions adjusters use

Territory: the United States, its territories and possessions, Puerto Rico and Canada, plus transport between their ports. Mexico is not included.
Termination: a new policy may be canceled during its first 60 days with at least 10 days’ notice. After that, or on a renewal, cancellation is allowed only for nonpayment, suspension or revocation of a resident or customary driver’s license, or material misrepresentation. State laws often add their own rules.
Our right to recover payment: the insurer takes over the insured’s subrogation rights, but not under Part D against a person using your covered auto with a reasonable belief of being entitled to.

See how these clauses play out on a file in our insurance claim process guide.

How state law changes the picture

State laws set minimum limits, require PIP in some states, and rewrite UM rules.

Topic	Texas	Florida
Minimum liability	30/60/25 ($30,000 per person, $60,000 per accident, $25,000 property damage)	$10,000 property damage liability (or a $30,000 combined single limit)
PIP	Included in every policy unless a named insured rejects it in writing; insurer need not provide more than $2,500 per person	$10,000 per person for medical and disability benefits, plus a $5,000 death benefit
PIP details	Medical, funeral, lost income and replacement services within 3 years, regardless of fault	80% of reasonable medical expenses; treatment must start within 14 days; $2,500 cap without an emergency medical condition
UM	Included unless rejected in writing; hit-and-run claims need actual physical contact	Included with bodily injury liability unless rejected in writing

In no-fault states, people collect PIP from their own insurer regardless of fault, and pain and suffering suits are limited by a monetary threshold (medical bills reach a set amount) or a verbal threshold (a statutory definition of serious injury). Florida’s threshold requires significant and permanent loss of an important bodily function, permanent injury, significant and permanent scarring or disfigurement, or death.

See the Texas and Florida license pages, then test yourself with the auto insurance practice test. New to the field? Start with how to become an insurance adjuster.

Written by the CoveragePrep editorial team. Researched from policy forms, state statutes, regulator websites and exam handbooks, then fact-checked in a separate review. Read our editorial policy or report an error.

Frequently asked questions

Does the personal auto policy cover a rental car?

Usually yes. A rental that is not furnished for regular use is a non-owned auto, so Part A follows the named insured and family members, and Part D gives it the broadest physical damage coverage shown on any declared auto, as excess over other sources. Loss of use charges the insured owes the rental company are paid up to $30 a day under the 2018 edition.

Is Other Than Collision the same thing as comprehensive coverage?

Yes. Comprehensive is the common marketing name. The ISO policy itself uses the term Other Than Collision for losses such as theft, fire, hail, flood, vandalism, glass breakage and hitting a bird or animal.

Does Part B Medical Payments pay if the injured person has health insurance?

Yes. Part B pays reasonable medical and funeral expenses for an insured regardless of fault, and the ISO form does not require the injured person to lack health insurance. State law and the policy's other insurance wording control how it coordinates with other auto medical coverage.

Whose insurance pays first when someone borrows a friend's car?

The owner's policy generally pays first, because it covers the borrower as a permissive user of the owner's covered auto. The borrower's own PAP covers a car the borrower does not own on an excess basis, so it pays only after the owner's limits are used up.