For the Arizona Personal Lines exam, the Personal Auto Policy (PAP) is tested two ways: the national policy structure and the Arizona auto laws layered on top of it. This standalone guide covers both—the lettered parts every PAP uses, then the Arizona rules on financial responsibility, the at-fault tort system, pure comparative negligence, uninsured-motorist offers, and cancellation notices. Learn the Arizona overlay especially well, because 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 liable 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 ground rules.

An insured generally includes the named insured, the resident spouse, resident family members (including a child away at school), and anyone using the covered auto with permission. Eligible vehicles are private passenger autos, pickups, and vans not used primarily for business. That national skeleton is the same everywhere; Arizona changes the limits and the legal environment around it.

Arizona is an at-fault (tort) state

Arizona uses a tort (at-fault) system rather than no-fault. The driver who causes a crash is financially responsible, and the injured party recovers from that driver's liability insurance or by filing suit. Because there is no mandatory PIP, liability coverage and financial responsibility dominate Arizona auto law.

Arizona also follows pure comparative negligence. Each party's damages are reduced by their own share of fault, and—unlike modified-fault states—there is no cutoff: even a driver who is 70% or 80% at fault can still collect the remaining percentage of their damages. Expect the exam to contrast this "pure" approach with the 51%-bar modified rule used elsewhere.

Financial responsibility: the 25/50/15 minimums

Arizona drivers must show financial responsibility, most commonly by buying liability insurance that meets the state minimum split limits of 25/50/15:

• $25,000 bodily injury per person
• $50,000 bodily injury per accident
• $15,000 property damage per accident

Arizona markets this as "25/50/15." Importantly, these minimums were increased on July 1, 2020 from the prior 15/30/10 limits—a change the exam loves to test. They are floor amounts; agents routinely recommend higher. Proof of financial responsibility can also come through other approved methods (such as a surety bond or cash deposit), but auto liability insurance is by far the usual route. Driving uninsured exposes the owner to fines, license/registration penalties, and personal liability for damages.

Uninsured/Underinsured Motorist offer rules

UM/UIM protects the insured when an at-fault driver has no insurance or not enough. In Arizona:

• Insurers must offer both UM and UIM coverage, and the insured may decline it by rejecting it in writing.
• It is generally available up to the insured's liability limits.
• The other driver must be legally at fault for UM/UIM bodily-injury coverage to respond.

The recurring exam theme: this coverage is offered and waivable only in writing—it is not something the insured must hunt for, nor is it forced on them.

Medical Payments in Arizona

Because Arizona is not a no-fault state, it has no required PIP. Drivers may instead purchase optional Medical Payments (Med Pay) coverage, which pays the insured's and passengers' medical and funeral costs regardless of fault, up to the limit chosen. Think of it as a first-party supplement that fills gaps after a crash, not a mandatory benefit.

Cancellation and nonrenewal notice

Arizona regulates how and when an insurer can end an auto policy. The timelines below are commonly cited; verify against current statute before relying on an exact day count:

• Cancellation during the term generally requires the insurer to mail advance written notice—often about 10 days for nonpayment of premium, and somewhat longer for other allowed reasons.
• After a personal auto policy has been in force a set period, the insurer may cancel only for limited reasons—chiefly nonpayment, driver's-license suspension/revocation, or fraud/material misrepresentation. It cannot drop the risk mid-term simply because it changed its mind.
• Nonrenewal (declining to continue at the end of the term) generally requires advance written notice—commonly around 30 days—so the insured can find replacement coverage.

Keep the shorter cancellation notice and the longer nonrenewal notice straight; both are common targets.

Required vs. optional coverages in Arizona

Key Arizona numbers to memorize

Common exam traps

• Arizona is at-fault, not no-fault. There is no mandatory PIP—optional Med Pay is the first-party medical coverage.
• 25/50/15, not 15/30/10—the bump took effect July 1, 2020.
• Do not transpose the $15k property-damage figure into a bodily-injury slot.
• Pure comparative negligence means a mostly-at-fault claimant can still recover a slice of damages—there is no 50%/51% bar.
• UM/UIM is offered and rejected in writing, never silently dropped.
• Hitting an animal is still Other Than Collision (Comprehensive), the same as the national rule.
• Liability defense costs are paid in addition to the limit (national rule that still applies in Arizona).

Quick recap

• The PAP keeps its national Parts A–F structure; Arizona changes the limits and legal context.
• Arizona is a tort/at-fault state using pure comparative negligence (recover even when mostly at fault).
• Financial responsibility minimums are 25/50/15, raised from 15/30/10 on July 1, 2020.
• UM/UIM must be offered and applies unless rejected in writing; there is no mandatory PIP, with Med Pay available as an option.
• Cancellation needs advance notice (commonly ~10 days) and nonrenewal more (commonly ~30 days); mid-term cancellation is limited to nonpayment, license suspension, or fraud.