For the Oregon Personal Lines exam, the Personal Auto Policy (PAP) is tested two ways: the national policy structure and the Oregon auto rules layered on top of it. This standalone guide walks through the lettered parts every PAP uses, then focuses on the Oregon rules an agent applies every day—financial-responsibility minimums, the mandatory Personal Injury Protection (PIP) and uninsured-motorist requirements, the at-fault legal system with modified comparative negligence, and how policies can be cancelled or nonrenewed. Spend your study time on the Oregon 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, 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 (in Oregon this is largely handled by mandatory PIP).
• 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; Oregon changes the dollar limits, the mandatory coverages, and the legal environment around it.

Oregon is an at-fault (tort) state that mandates PIP

Oregon follows a tort (at-fault) system rather than a no-fault system—but it also requires Personal Injury Protection (PIP) on every auto policy. This combination trips up test-takers: mandatory PIP does not convert Oregon into a no-fault state. The at-fault driver is still legally responsible, and the injured party can still recover from that driver's liability coverage or by filing suit. PIP simply adds first-dollar, no-fault medical and wage benefits for the insured after a crash.

• PIP pays the insured's and passengers' reasonable medical bills, lost wages, and certain related expenses up to the PIP limit, regardless of who was at fault.
• Because Oregon keeps tort liability, the right to sue the at-fault driver is preserved, with PIP benefits coordinated against any recovery.

Modified comparative negligence (51% bar)

When both drivers share blame, Oregon uses modified comparative negligence with a 51% bar rule. Each party's recovery is reduced by that party's own percentage of fault, and a claimant whose fault reaches 51% or more is barred entirely. A claimant who is 50% or less at fault still recovers, reduced by their share. This differs from a pure comparative system (where even a mostly-at-fault claimant recovers something) and from a no-fault system (where each driver turns first to their own coverage). Remember: Oregon is modified comparative with a 51% bar.

Financial responsibility: the 25/50/20 minimums plus PIP and UM

Oregon drivers must demonstrate financial responsibility, almost always by buying the mandatory coverages, with liability meeting the state's minimum split limits, commonly cited as 25/50/20:

• $25,000 bodily injury per person
• $50,000 bodily injury per accident
• $20,000 property damage per accident

Agents say this aloud as "25/50/20" (verify the current statutory figures). On top of liability, Oregon requires PIP and uninsured motorist (UM) coverage—these are mandatory, not optional offers. These are bare-minimum floors—most clients should buy more to protect their assets. After certain serious violations a high-risk driver may be required to file an SR-22 certifying that the required coverage is in place.

Uninsured and underinsured motorist coverage

Here is a point Oregon agents must apply: UM coverage is mandatory in Oregon, and UIM rounds it out.

• 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: Oregon requires UM (not merely an offer the agent can skip), and these coverages respond only when the other driver is legally at fault.

Coverages, limits, and loss settlement

• In a 25/50/20 limit, the third number (20) is the property-damage liability limit per accident; the first two are BI per person and per accident.
• PIP pays medical expenses and wage loss 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

Oregon 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 Oregon

Key Oregon numbers to memorize

Common exam traps

• Oregon is at-fault, but mandates PIP—mandatory PIP does not make it a no-fault state; the right to sue the at-fault driver remains.
• Oregon uses modified comparative negligence with a 51% bar—a claimant 51% or more at fault recovers nothing.
• 25/50/20—don't transpose the $20k property-damage figure into a bodily-injury slot.
• PIP and UM are both required in Oregon; treat them as mandatory, not optional add-ons.
• Hitting an animal is Comprehensive, not Collision.
• Collision/Comprehensive pay ACV on a total loss; the deductible is the insured's share first.
• Liability defense costs are paid in addition to the limit (national rule that still applies in Oregon).

Quick recap

• The PAP keeps its national Parts A–F structure; Oregon changes the limits, mandatory coverages, and legal context.
• Oregon is a tort/at-fault state using modified comparative negligence with a 51% bar—a claimant 51% or more at fault recovers nothing.
• Financial-responsibility minimums are commonly cited as 25/50/20 (verify).
• Oregon requires PIP and uninsured motorist coverage—mandatory, not optional offers.
• Mandatory PIP does not make Oregon no-fault; it provides first-dollar medical/wage benefits while preserving the right to sue.
• Mid-term cancellation and nonrenewal require the advance written notice the law specifies, with unearned premium refunded.