For the New Hampshire Personal Lines exam, the Personal Auto Policy (PAP) is tested two ways: the national policy structure and the New Hampshire auto rules layered on top of it. The rule that surprises most candidates is that New Hampshire generally does not force drivers to carry liability insurance—it is a financial-responsibility state instead. This standalone guide walks through the lettered parts every PAP uses, then focuses on the New Hampshire rules an agent applies every day—the no-mandatory-insurance distinctive, the 25/50/25 minimums that apply once a policy is bought, the mandatory uninsured-motorist and medical-payments coverages inside a New Hampshire policy, the at-fault legal system with modified comparative negligence, and how policies can be cancelled or nonrenewed.

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, with a duty to defend and defense costs paid on top of the limit.
• Part B — Medical Payments: pays reasonable 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 (impact or upset) and Other Than Collision (Comprehensive) (theft, fire, hail, hitting an animal), 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. The policy also extends the named insured's liability coverage to a non-owned auto the insured borrows with permission. Eligible vehicles are private passenger autos owned by individuals and households, not commercial trucks or buses. That skeleton is the same nationwide; New Hampshire changes the dollar limits and the legal environment around it.

New Hampshire does not require you to buy auto insurance

Lead with this, because it is the most distinctive New Hampshire rule. Unlike most states, New Hampshire has no across-the-board compulsory auto-insurance law. What the state does require is that drivers be able to meet a financial-responsibility standard—proof they can pay for harm they cause. A driver can satisfy that obligation by buying a policy or, in limited cases, by posting a cash deposit or bond with the state.

The catch the exam loves: a driver who chooses to go without insurance is personally on the hook for any damages they cause, and after an at-fault accident or certain convictions the state can suspend the license and registration and require the driver to file proof of financial responsibility (an SR-22) going forward. Because of that risk—and because lenders demand coverage—most New Hampshire drivers buy a policy anyway. For the test, anchor on the phrase: New Hampshire is a financial-responsibility state, not a compulsory-insurance state.

Once a policy is bought: 25/50/25 minimums, plus mandatory UM and Med Pay

When a New Hampshire motorist does purchase auto coverage, state law dictates the floor limits and certain coverages the policy must contain. The minimum split limits are commonly cited as 25/50/25:

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

Agents say this aloud as "25/50/25" (verify the current statutory figures). On top of liability, a purchased New Hampshire auto policy must also include:

• Uninsured/Underinsured Motorist (UM/UIM) coverage, generally at limits at least equal to the liability limits—this is required, not just offered.
• Medical Payments coverage at the required minimum (commonly cited as at least $1,000—verify), likewise required.

So memorize the pairing: you don't have to buy a policy, but if you do, UM/UIM and Med Pay come built in. Most clients should also buy higher liability limits to protect their assets.

New Hampshire is an at-fault (tort) state

New Hampshire 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 New Hampshire auto law.

When both drivers share blame, New Hampshire uses modified comparative negligence with a 51% bar. A claimant may recover only if their share of fault is not greater than the defendant's (in practice, 50% or under recovers; 51% or more is barred), and any recovery is reduced by the claimant's own percentage of fault. This differs from a pure comparative system (where a claimant who is 80% at fault still recovers 20%) and from a no-fault system (where each driver turns first to their own coverage). Remember: New Hampshire is modified comparative, 51% bar.

Uninsured and underinsured motorist coverage

Here is a point New Hampshire agents must apply: because UM/UIM is mandatory in a purchased policy, every New Hampshire auto policy carries it unless the insured affirmatively reduces it where allowed.

• Uninsured Motorist (UM) bodily injury coverage responds when the insured is injured by an at-fault driver who carries no liability insurance, including a hit-and-run driver.
• Underinsured Motorist (UIM) applies when the at-fault driver has insurance but at limits 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: New Hampshire builds UM/UIM into a purchased policy at limits tied to the liability limits, and these coverages respond only when the other driver is legally at fault.

Coverages, limits, and loss settlement

• In a 25/50/25 limit, the third number (25) is the property-damage liability limit per accident; the first two are BI per person and per accident.
• Medical payments pays reasonable medical expenses for the insured and passengers regardless of fault; collision pays impact/upset damage; comprehensive pays theft, fire, hail, vandalism, and animal strikes.
• The deductible is the amount the insured pays before the insurer covers the rest of a covered physical-damage loss.
• Transportation expenses / rental reimbursement helps pay for a rental while the covered auto is repaired after a covered loss, and towing and labor coverage pays roadside costs up to a stated limit.
• Exclusions to remember: organized racing for prize money is excluded, as is intentional or business use beyond the policy's scope.
• After a loss the insured's duties include promptly notifying the insurer and cooperating in the investigation. The named insured may cancel the policy at any time by notifying the insurer.

Cancellation and nonrenewal notice

New Hampshire limits how and when an insurer can end a personal auto policy:

• Mid-term cancellation generally requires the insurer to provide the policyholder the advance written notice the law requires.
• Nonrenewal (declining to continue at the end of the term) likewise requires advance notice within the required time, so the insured can shop for replacement coverage.
• On cancellation the insurer retains only the earned premium and refunds the unearned portion; an insurer-initiated cancellation refunds pro rata without penalty.

Required vs. optional coverages in New Hampshire

Key New Hampshire numbers to memorize

Common exam traps

• Saying New Hampshire mandates auto insurance. It generally does not—it's a financial-responsibility state, and a bond or deposit is an alternative.
• Forgetting that UM/UIM and Med Pay are mandatory once a policy is bought. Insurance is optional to own, but a purchased policy must include them.
• New Hampshire is at-fault, not no-fault—there is no mandatory PIP here.
• New Hampshire uses modified comparative negligence (51% bar)—a claimant whose fault is greater than the other party's recovers nothing.
• 25/50/25—don't transpose the $25k property-damage figure into a bodily-injury slot.
• Hitting an animal is Comprehensive, not Collision.
• Collision/Comprehensive pay ACV on a total loss; the deductible is the insured's share first.

Quick recap

• The PAP keeps its national Parts A–F structure; New Hampshire changes the limits and legal context.
• New Hampshire is distinctive: it does not require drivers to buy liability insurance, using a financial-responsibility standard you can also satisfy with a bond or deposit.
• If a policy is purchased, minimums are 25/50/25, and the policy must include mandatory UM/UIM and Medical Payments.
• New Hampshire is a tort/at-fault state using modified comparative negligence with a 51% bar.
• New Hampshire has no mandatory no-fault/PIP; Collision and Comprehensive are optional.
• Mid-term cancellation and nonrenewal require the advance written notice the law specifies, with unearned premium refunded.