On the New York Property & Casualty exam, the personal automobile policy is tested heavily because New York runs a No-Fault system with its own mandatory benefits, statutory limits, and a distinctive coverage called SUM. This standalone guide briefly reviews the national auto-policy fundamentals, then centers on New York law — No-Fault/PIP, financial responsibility minimums, required and optional coverages, and the cancellation/nonrenewal protections enforced by the Department of Financial Services.

National fundamentals in brief

A personal auto policy everywhere is assembled from the same building blocks: liability for bodily injury (BI) and property damage (PD) you cause, medical payments, uninsured/underinsured motorists, and physical damage (collision plus other-than-collision). The standard policy is organized into lettered parts (Liability, Medical Payments, UM/UIM, Damage to Your Auto, Duties After a Loss, and General Provisions). New York keeps this structure but replaces several pieces with statutory coverages, so when a question pits the generic answer against a New York rule, apply the New York rule.

New York's No-Fault system

New York auto insurance is governed by the Comprehensive Motor Vehicle Insurance Reparations Act (Insurance Law Article 51) — the No-Fault law. After a covered accident, the injured person's own insurer pays medical and economic losses without regard to fault, which keeps routine injury claims out of the courts.

• The No-Fault benefit pays basic economic loss as first-party (PIP) benefits: medical/health expenses, lost earnings, other necessary expenses, and a death benefit, up to $50,000 per person.
• In exchange for guaranteed benefits, the right to sue for pain and suffering is limited. A liability suit for non-economic damages is allowed only when the injury satisfies the "serious injury" verbal threshold (death, dismemberment, significant disfigurement, fracture, permanent loss of use of a body organ or function, and similar listed categories).

Remember the boundary: No-Fault pays your injuries and economic loss, not your vehicle damage (that's physical damage coverage) and not your liability to others.

Coverages required on every New York policy

New York mandates a broader package than the bare liability many states require. Every registered private passenger vehicle must carry:

• Bodily Injury and Property Damage Liability at the statutory minimums.
• No-Fault / PIP (basic economic loss) of $50,000.
• Uninsured Motorists (UM) for bodily injury.

Financial responsibility limits

New York's compulsory minimum liability limits, set under the Vehicle and Traffic Law, are a split limit:

• $25,000 BI per person
• $50,000 BI per accident
• $10,000 PD per accident

So the headline is 25 / 50 / 10. New York layers on higher limits that apply specifically to death claims, usually stated as $50,000 / $100,000 (50/100). Expect the exam to test both the everyday 25/50/10 and the 50/100 death overlay.

SUM: Supplementary Uninsured/Underinsured Motorists

SUM is the New York label you must know cold.

• Uninsured Motorists (UM) applies when the at-fault driver had no coverage or was a hit-and-run driver.
• The SUM / underinsured component applies when the at-fault driver was insured but carried limits too low to pay your damages; your SUM coverage makes up the difference up to your own SUM limit.
• SUM is optional, but insurers must offer it, and it is commonly written up to the insured's own liability limits.

When no insurance applies at all — an uninsured, unidentified, or hit-and-run vehicle and no other coverage — the Motor Vehicle Accident Indemnification Corporation (MVAIC) can act as the payer of last resort for qualified victims.

Residual market and physical damage

Drivers rejected by the standard market obtain coverage through the New York Automobile Insurance Plan (NYAIP), the state's assigned-risk plan, ensuring everyone can meet the mandatory-insurance requirement.

Physical damage in New York works like the national model: collision for impacts and overturns and other-than-collision (comprehensive) for fire, theft, vandalism, glass, hail, flood, and animal strikes — each typically subject to a deductible and paid at actual cash value (ACV). These are optional unless required by a lender or lease. A classic carryover trap: hitting an animal is other-than-collision, not collision.

Cancellation and nonrenewal protections

New York gives policyholders strong protection against losing coverage:

• In the first 60 days a new policy is in force, the insurer may cancel for ordinary underwriting reasons (the initial review period).
• After 60 days (and on renewals), cancellation is allowed only for limited reasons — primarily nonpayment of premium, suspension or revocation of the license/registration of the named insured or a regular driver, or fraud/material misrepresentation.
• Advance written notice is always required: a shorter window for nonpayment (about 15 days) and a longer window for other permitted reasons (commonly around 20 days). Confirm exact figures for your exam, but know that notice is mandatory.
• Nonrenewal and conditional renewal also require advance written notice — New York's standard is roughly 45–60 days before expiration — so the insured can shop for replacement coverage.

Key New York numbers to memorize

Common exam traps

• Treating New York as a tort/at-fault state. It is No-Fault with a serious-injury threshold for lawsuits.
• Misstating PIP. Basic economic loss is $50,000 per person.
• Believing No-Fault repairs your car. It pays injuries/economic loss, not vehicle damage.
• Ignoring the death overlay. Minimums are 25/50/10 with 50/100 for death.
• Confusing UM and SUM. UM = uninsured/hit-and-run; SUM adds the underinsured gap.
• Calling animal strikes "collision." They are other-than-collision.
• Assuming free cancellation. After 60 days, the insurer needs nonpayment, license/registration suspension, or fraud.

Quick recap

New York's personal auto policy uses the standard liability/medical/UM/physical-damage framework but is governed by the No-Fault Reparations Act. The driver's own insurer pays basic economic loss (PIP) up to $50,000 regardless of fault, and lawsuits for pain and suffering require crossing the serious-injury threshold. Every vehicle must carry liability at 25/50/10 (plus a 50/100 death overlay), No-Fault, and Uninsured Motorists, with SUM the popular optional add-on for underinsured at-fault drivers. The MVAIC backstops uninsured/hit-and-run victims, the NYAIP supplies assigned-risk coverage, and DFS under the Superintendent enforces the cancellation/nonrenewal limits that protect drivers after the first 60 days.