On the Tennessee Property & Casualty exam, the Personal Automobile Policy appears both as a standard ISO-style contract and as a set of Tennessee auto rules you must apply. This standalone guide reviews the policy's coverage parts, then drills into the Tennessee overlay: the financial-responsibility minimums, the at-fault (tort) system with modified comparative negligence, the uninsured- and underinsured-motorist rules, and cancellation/nonrenewal notice. The Tennessee-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.
• Part B — Medical Payments: pays reasonable medical/funeral costs for the insured and occupants regardless of fault.
• 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., 25/50/15) or as a Combined Single Limit (CSL). Insureds include the named insured, resident spouse, resident relatives (including a child away at school), and permissive users. The coverage territory is generally the U.S., its territories and possessions, and Canada—not most foreign countries. Eligible vehicles are private passenger autos, pickups, and vans not used mainly for business. That framework is national; Tennessee governs the limits and the liability environment around it.

Tennessee uses a tort (at-fault) liability system

Tennessee is an at-fault / tort state, not a no-fault state. The driver who causes a crash is financially responsible, and the injured party collects from that driver's liability coverage or by filing suit. This is why liability coverage and financial responsibility dominate Tennessee auto law.

Tennessee applies modified comparative negligence under the well-known Tennessee Supreme Court case McIntyre v. Balentine. The rule to remember: a claimant who is 50% or more at fault is barred from recovering anything (the "50% bar"). If the claimant is less than 50% at fault, they may recover, but the award is reduced by their own percentage of fault. (Contrast this with pure comparative states, where even a 90%-at-fault claimant recovers a sliver.)

Financial responsibility: the minimum limits

Every Tennessee driver must show financial responsibility, usually by carrying liability insurance at or above the state's minimum split limits:

• $25,000 bodily injury per person
• $50,000 bodily injury per accident
• property damage per accident — commonly cited as $15,000 (shorthand "25/50/15"), though Tennessee raised the property-damage minimum to $25,000 (commonly cited as effective 2023). Verify the current figure; if the exam answer choices include 25/50/15, that is the historically tested number.

These are statutory floors; producers routinely recommend higher limits. Tennessee enforces coverage through an electronic insurance verification program (commonly branded as "Drive Insured"), and driving uninsured brings fines and loss of registration. A deposit or bond can satisfy financial responsibility, but liability insurance is the standard method.

Uninsured and underinsured motorist rules

This is a heavily tested Tennessee area:

• Uninsured/Underinsured Motorist (UM/UIM) coverage must be OFFERED on every Tennessee auto policy, at limits at least equal to the policy's bodily-injury liability limits. It is automatically included unless the named insured rejects it (or selects lower limits) in writing. UM also responds to hit-and-run drivers.
• UIM pays when the at-fault driver has insurance but not enough—it fills the gap between that driver's lower BI limits and the insured's UIM limit.
• The other driver must be legally at fault for UM/UIM to respond.

Memorize the headline: in Tennessee, UM/UIM must be offered at the BI limits and is included unless rejected in writing.

Optional and physical-damage coverages

• Medical Payments (Med Pay) is optional and pays medical/funeral costs regardless of fault. Tennessee does not mandate PIP/no-fault.
• Collision and Comprehensive (Other Than Collision) are optional but typically required by a lender. Hitting an animal, plus fire, theft, and hail, is Comprehensive, not Collision.
• Towing, rental reimbursement, and transportation expense are optional add-ons by endorsement for extra premium.
• The PAP excludes intentional damage, use in organized racing, and using the auto as a public taxi (livery) unless endorsed.

Cancellation and nonrenewal

Tennessee regulates how an insurer may end a personal auto policy. The timelines are commonly cited as:

• Mid-term cancellation generally requires advance written notice (often around 30 days, with a shorter window—about 10 days—allowed for nonpayment of premium).
• After a policy has been in force a set period, cancellation is limited to specific reasons such as nonpayment, license suspension/revocation, or fraud/material misrepresentation.
• Nonrenewal 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 nonpayment-cancellation notice distinct from the longer ordinary cancellation / nonrenewal notice (verify the exact days).

Required vs. optional coverages

Key Tennessee numbers to memorize

Common exam traps

• Tennessee is at-fault (tort), not no-fault. There is no mandatory PIP.
• Read the property-damage figure carefully—it is historically $15,000 (25/50/15) but was raised toward $25,000; pick the figure the question's choices support, and verify.
• UM/UIM must be offered and is included unless rejected in writing—don't call it flatly "mandatory" or flatly "optional."
• Modified comparative negligence: 50% or more at fault = barred (the 50% bar—watch the exact wording: recovery only if less than 50% at fault).
• UIM fills the gap up to your UIM limit minus the other driver's BI payment; it is not a separate full payout.
• Hitting an animal is Comprehensive, not Collision (national rule still applies).

Quick recap

• The PAP's Parts A–F structure is national; Tennessee sets the limits and legal framework.
• Tennessee is a tort/at-fault state using modified comparative negligence—a claimant 50% or more at fault recovers nothing (McIntyre v. Balentine).
• Minimum liability is 25/50/15 historically, with property damage raised toward $25,000 (verify).
• UM/UIM must be offered at the BI limits and is included unless rejected in writing.
• Tennessee has no mandatory no-fault/PIP; Med Pay and physical damage are optional.
• Cancellation for nonpayment uses a shorter (~10-day) notice; ordinary cancellation/nonrenewal uses a longer (~30-day) notice.