For the Arkansas Personal Lines exam, the Personal Auto Policy (PAP) is tested two ways: the national policy structure and the Arkansas auto laws layered on top of it. This standalone guide walks through the lettered parts every PAP uses, then focuses on the Arkansas rules an agent applies every day—financial-responsibility minimums, the at-fault legal system, the offer-and-written-rejection rule for uninsured-motorist coverage, underinsured-motorist coverage, SR-22 filings, and how policies can be cancelled or nonrenewed. Spend your study time on the Arkansas overlay; that is where the state questions live.

The national fundamentals (quick version)

The Personal Auto Policy insures individuals and families for the vehicles they own and drive. It is divided into clearly labeled parts:

• Part A — Liability Coverage: pays for bodily injury (BI) and property damage (PD) the insured is legally responsible for, and includes a duty to defend with defense costs paid on top of the limit.
• Part B — Medical Payments: pays medical and funeral expenses for the insured and passengers regardless of fault.
• Part C — Uninsured/Underinsured Motorists (UM/UIM): pays your injuries when the at-fault driver has no insurance or too little.
• Part D — Coverage for Damage to Your Auto: Collision and Other Than Collision (Comprehensive), each with a deductible, paid at Actual Cash Value (ACV).
• Part E — Duties After an Accident or Loss and Part F — General Provisions set the rules.

An insured generally includes the named insured, the resident spouse, resident family members, and anyone using the covered auto with permission. A temporary substitute auto and certain newly acquired autos are generally treated as covered. Eligible vehicles are private passenger autos, pickups, and vans not used primarily for business. That skeleton is the same nationwide; Arkansas changes the dollar limits and the legal environment around it.

Arkansas is an at-fault (tort) state

Arkansas follows a tort (at-fault) system rather than a no-fault system. Whoever causes the crash is financially responsible, and the injured person recovers from that driver's liability insurance—or sues. Because of this, liability coverage and proof of financial responsibility are the backbone of Arkansas auto regulation.

When both drivers share blame, Arkansas uses modified comparative fault. Picture a simple cutoff—the "50% bar": an injured person who is 50% or more responsible recovers nothing at all (verify the current standard). If their share is less than 50%, they can still collect, but the payout is trimmed by their own percentage of fault. This differs from a pure comparative system (where any at-fault claimant recovers something) and from a no-fault system (where each driver turns first to their own coverage).

Financial responsibility: the 25/50/25 minimums

Arkansas drivers must demonstrate financial responsibility, almost always by buying liability insurance that meets the state's minimum split limits of 25/50/25 (verify current figures):

• $25,000 bodily injury per person
• $50,000 bodily injury per accident (total for all injured persons)
• $25,000 property damage per accident

Agents say this aloud as "25/50/25." Remember that the middle number (50) is the total bodily-injury liability available per accident for all persons, while the first number (25) caps any one injured person. These are bare-minimum floors—most clients should buy more to protect their assets. An uninsured driver faces fines, suspension, and reinstatement costs.

Uninsured motorist coverage: offered, rejected in writing

Here is a point Arkansas agents must get right: Uninsured Motorist (UM) coverage must be OFFERED on Arkansas auto policies, and to decline it the insured generally must reject it in writing (verify). UM protects you and your passengers when the at-fault driver carries no insurance or flees the scene (hit-and-run). Don't answer that UM is impossible to decline—and don't answer that it need not be offered.

Underinsured motorist coverage

Underinsured Motorist (UIM) handles the situation where the at-fault driver has insurance, just not enough to cover your injuries.

• UIM is generally offered alongside UM.
• UIM applies when the at-fault driver's liability limits are too low to cover the insured's damages.
• UIM pays the difference between the other driver's lower BI limit and your UIM limit—so a client with strong UIM is protected even against a bare-minimum at-fault driver.

The recurring theme: UM/UIM protect you when the other driver is uninsured or underinsured, and Arkansas requires the coverage to be offered.

SR-22 filings, no-fault, and the optional coverages

• An SR-22 is a financial-responsibility filing the insurer makes to certify that a high-risk driver maintains the required liability insurance—it is proof of coverage, not a coverage type or a waiver.
• Arkansas does not require a mandatory PIP / no-fault liability system. Medical Payments (Med Pay) and similar first-party medical benefits are available (commonly offered and rejectable in writing — verify) and pay regardless of fault.
• Collision and Comprehensive (Other Than Collision) are optional, though a lender usually requires them on a financed vehicle. Hitting an animal is Comprehensive, not Collision.

Cancellation and nonrenewal notice

Arkansas limits how an insurer can end a personal auto policy, generally requiring advance written notice before canceling or nonrenewing. The timelines are commonly cited as follows (verify):

• Cancellation for nonpayment of premium uses a shorter notice (often around 10 days).
• Other mid-term cancellations require a longer notice (commonly around 30 days), and after a policy has been in force a set time the insurer may cancel only for limited reasons—chiefly nonpayment, license suspension/revocation, or fraud/material misrepresentation.
• Nonrenewal at the end of the term likewise requires advance written notice so the insured can shop for replacement coverage.

Keep the short nonpayment window separate from the longer ordinary-cancellation / nonrenewal window.

Required vs. optional coverages in Arkansas

Key Arkansas numbers to memorize

Common exam traps

• Arkansas is at-fault, not no-fault—there is no mandatory PIP liability system here.
• 25/50/25—the last 25 is property damage; the middle 50 is total BI per accident. Don't transpose the numbers.
• UM must be offered in Arkansas and can be declined only in writing—it is neither impossible to decline nor optional to offer.
• Modified comparative fault: 50% or more at fault means no recovery (the 50% bar—watch the exact wording).
• An SR-22 is a filing, not coverage.
• UIM fills the gap (your UIM limit minus the other driver's BI payment); it isn't a second full benefit on top.
• Hitting an animal is Comprehensive, not Collision; liability defense costs are paid in addition to the limit (national rules that still apply).

Quick recap

• The PAP keeps its national Parts A–F structure; Arkansas changes the limits and legal context.
• Arkansas is a tort/at-fault state using modified comparative fault, where a claimant 50% or more at fault recovers nothing (verify).
• Financial-responsibility minimums are 25/50/25.
• Uninsured Motorist must be offered and can be declined only in writing, and Underinsured Motorist fills the gap up to your limit.
• Arkansas has no mandatory no-fault/PIP; Med Pay, Collision, and Comprehensive are optional, and an SR-22 certifies a high-risk driver's required liability coverage.
• Cancellation for nonpayment uses a short (~10-day) notice; ordinary cancellation/nonrenewal uses a longer (~30-day) notice.