In templates, where it says {{first name}}, is the name automatically added?

Yes, the merge tags in templates will automatically add the appropriate information when you send your email. You can use the following merge tags in your templates: {{first name, fallback=}} inserts the contact's first name (when it is present, and leaves a blank when no first name has been entered) & {{last name, fallback=}}inserts the contact's last name (when it is present, and leaves a blank when no last name has been entered).