On the Hawaii Property & Casualty exam, the Personal Automobile Policy appears both as a standard ISO-style contract and as a set of Hawaii auto statutes you must apply. The single most important fact: Hawaii is a no-fault auto state. This standalone guide reviews the policy's coverage parts, then drills into the Hawaii overlay—mandatory personal injury protection (PIP), the tort threshold, the new 40/80/20 liability minimums, and the uninsured/underinsured motorist rules. The Hawaii-specific material is where most state credit is earned.

Policy structure (the national base)

The Personal Auto Policy (PAP) is a packaged contract organized into lettered parts:

• Part A — Liability: pays bodily injury (BI) and property damage (PD) the insured is legally liable for; the insurer provides a defense, and defense costs are paid in addition to the limit.
• Part B — Medical Payments: pays medical/funeral costs for occupants (in Hawaii this role is largely filled by PIP).
• Part C — Uninsured/Underinsured Motorists: pays the insured's injuries when the at-fault party is uninsured or underinsured.
• Part D — Coverage for Damage to Your Auto: Collision and Other Than Collision (Comprehensive), each with a deductible, settled at Actual Cash Value (ACV).
• Part E — Duties After an Accident or Loss and Part F — General Provisions.

Limits may be written as split limits (e.g., 100/300/50) or as a Combined Single Limit (CSL). In split limits, the first number is BI per person, the second is total BI per accident, and the third is PD per accident. Insureds include the named insured, resident family members, and permissive users. That framework is national; Hawaii governs the limits and the no-fault environment around it.

Hawaii is a no-fault state with mandatory PIP

Unlike many states, Hawaii uses a no-fault automobile system. Each driver's own personal injury protection (PIP) pays that driver's accident-related medical and rehabilitative costs regardless of who was at fault, up to the PIP limit. Hawaii law requires every motor vehicle policy to include PIP—commonly cited as at least $10,000 per person for medical/rehabilitative expenses—verify the current figure. Drivers may also purchase optional wage-loss benefits in addition to basic PIP to replace income lost from a no-fault injury.

Because each insured turns first to their own PIP, no-fault is designed to pay smaller injury claims quickly without litigation over fault.

The tort threshold

No-fault does not abolish lawsuits; it limits them. An injured person may step outside the no-fault system and sue the at-fault driver for pain and suffering only when the injury meets a statutory tort threshold (a stated level of injury or medical expense). Below that threshold, the injured person recovers through their own PIP rather than by suing. Expect at least one question testing that pain-and-suffering suits require meeting the tort threshold.

When fault is litigated, Hawaii applies modified comparative negligence, commonly described as a 51% bar: a claimant who is more than 50% at fault recovers nothing, while a claimant who is 50% or less at fault recovers an award reduced by their own percentage of fault—verify the exact threshold.

Financial responsibility: 40/80/20

Hawaii requires drivers to carry liability insurance at or above the statutory minimum split limits. Note the recent change, which the exam highlights:

• Effective January 1, 2026, Hawaii's minimum liability limits increased to 40/80/20:
  • $40,000 bodily injury per person
  • $80,000 bodily injury per accident
  • $20,000 property damage per accident
• These replaced the longstanding 20/40/10 minimums ($20,000 / $40,000 / $10,000)—verify current law and effective date.

Know both sets of numbers and which is current. Drivers must carry and be able to show proof of insurance, and driving without the required coverage brings fines and possible license suspension. A high-risk driver may be required to file an SR-22 certifying that required liability coverage is in force.

Uninsured and underinsured motorist rules

This is a heavily tested Hawaii area:

• Before issuing an auto policy, the insurer must offer uninsured motorist (UM) and underinsured motorist (UIM) coverage.
• The insured may accept or reject UM/UIM, but a rejection must be in writing. If the insured does nothing, the coverage is generally provided.
• UM pays the insured's injuries caused by an at-fault driver who has no insurance (and responds to hit-and-run drivers); UIM pays the gap when the at-fault driver has insurance but not enough.
• The other driver must be legally at fault for UM/UIM to respond. Stacking (combining UM limits across multiple owned vehicles) may be available—verify.

Memorize the headline: in Hawaii, UM/UIM must be offered, and a written rejection is required to waive it.

Physical-damage and optional coverages

• Collision and Comprehensive (Other Than Collision) are optional but typically required by a lender. Hitting an animal is Comprehensive, not Collision.
• A total loss is settled at actual cash value; gap coverage can pay the difference between ACV and a remaining loan balance.
• Hawaii drivers can obtain coverage through the state's assigned-risk or joint underwriting plan if rejected by the voluntary market—verify the current mechanism.

Key Hawaii numbers to memorize

Common exam traps

• Calling Hawaii an at-fault/tort state. Hawaii is no-fault with mandatory PIP.
• Forgetting the tort threshold. Pain-and-suffering suits require meeting a statutory threshold.
• Using the old 20/40/10 as current. As of January 1, 2026 the minimum is 40/80/20—know both and which is current.
• Saying UM/UIM is automatic or cannot be rejected. It must be offered and can be rejected in writing.
• Sliding the $20k PD figure into a BI slot.
• Treating PIP as fault-based. PIP pays regardless of fault.
• Hitting an animal is Comprehensive, not Collision (national rule still applies).

Quick recap

• The PAP's Parts A–F structure is national; Hawaii sets the limits and the no-fault framework.
• Hawaii is a no-fault state with mandatory PIP (commonly $10,000/person, verify) plus optional wage-loss benefits.
• Lawsuits for pain and suffering require meeting a tort threshold; litigated fault uses modified comparative negligence (commonly a 51% bar).
• Minimum liability is 40/80/20 effective January 1, 2026, up from 20/40/10.
• UM/UIM must be offered and can be rejected only in writing.
• Physical damage is optional; the assigned-risk/joint underwriting plan backstops drivers shut out of the voluntary market—verify any specific figure.