Arkansas Car Insurance Laws: What You Need to Know

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Like most states, Arkansas requires a minimum amount of auto insurance coverage to legally drive on public roads. While the cost of insurance can seem overwhelming and the temptation to skip a payment can be strong, this analysis of Arkansas auto insurance laws should prove that risking the consequences of lapsed coverage isn’t worth it. From fines to paying out of pocket for a car accident, Bankrate will help you navigate Arkansas insurance laws and make sure you have the appropriate coverage to protect yourself and your finances.

Arkansas Car Insurance Laws

Every driver in Arkansas must carry a minimum amount of car insurance to legally operate their vehicle. The minimum requirement in Arkansas is a 25/50/25 insurance policy, which is short for the following liability limits:

• $25,000 personal injury liability insurance per person
• $50,000 personal injury liability insurance per accident
• $25,000 property damage liability insurance per accident

Arkansas auto insurance companies must also offer coverage for uninsured and underinsured motorists, but this coverage may be declined by the policyholder.

If you cause an accident, bodily injury liability coverage will cover the other driver’s medical expenses, while property damage liability coverage will cover repairs to the other driver’s car if damage occurs. It’s important to note that a minimum coverage policy in Arkansas does not provide protection for your own vehicle.

Arkansas also requires your insurance company to offer you personal injury protection (PIP) insurance and requires you to decline the offer in writing if you do not wish to purchase it.

Liability Insurance in Arkansas

Arkansas auto insurance laws require you to carry liability insurance with at least 25/50/25 coverage. But is that enough to protect you in a serious car accident? Many insurance experts would say no.

If you cause an accident that results in damages that exceed your liability limits, you’ll have to pay the excess out of pocket. Car accidents can be expensive, and the costs of even a minor accident can add up quickly.

Additionally, liability insurance covers damage and costs to the other car in an at-fault accident, not your own car. If your own vehicle is damaged in an at-fault accident and you have insurance with minimum coverage, you will have to pay for any damage to your car out of your own pocket. If you want to insure your own vehicle, you will need to purchase comprehensive insurance, which includes collision and comprehensive coverage. Although your premium will be more expensive, you may be better protected financially in the event of a covered incident such as an accident or vandalism.

Is Arkansas a no-fault state?

Arkansas is not a no-fault state, but rather an at-fault or tort state, meaning the at-fault driver’s insurance will pay the hospital bills, lost wages, and other medical expenses related to the other driver’s accident.

In contrast, no-fault states require the driver’s own insurer to cover the costs of injuries, regardless of who is at fault. For this reason, drivers in no-fault states are required to carry personal injury insurance (PIP).

Penalties for driving without insurance in Arkansas

According to Arkansas Motor Vehicle and Traffic Laws Act 27-22-103, driving without insurance is illegal. But how much is a fine in Arkansas for not having insurance? Let’s take a look at the fine table:

• First violation: Fine of $100 to $250
• Second violation: Fine of $250 to $500
• Third and subsequent violations: Fine of $500 to $1,000 or one year in prison, or both

If you are caught without insurance during a traffic stop or after an accident, in addition to fines, your registration will typically be suspended until you provide proof of insurance to the Arkansas DMV. Depending on the court’s decision, you may be required to provide an SR-22 as proof of insurance, which is usually more expensive than a standard insurance policy. Once you obtain the required coverage, you will have to pay a $20 reinstatement fee to reinstate your vehicle’s registration.

In fact, you can even be penalized if your insurance policy lapsed while you’re sitting at home on the couch. In 2020, Arkansas passed a new law to support a verification system that actively monitors the status of your insurance policy and automatically fines you $100 if a default is detected. If the driver fails to provide updated proof of insurance within a certain period of time, their license will be permanently suspended until they obtain insurance and pay the fine.

As the Arkansas Advocate reports, this verification system has reduced the rate of uninsured drivers from 16% in 2020 to 8.7% in 2023. This is a huge breakthrough considering how complicated and expensive car accidents can be when one or both parties are uninsured.

Additional options for auto insurance coverage in Arkansas

Arkansas car insurance laws require every driver to have at least a minimum coverage policy. However, many drivers choose to purchase additional insurance to be more financially secure. This may include comprehensive insurance components such as collision and comprehensive coverage, but may also include add-ons. Not all car insurance companies offer these add-ons, but some common ones include:

• Comprehensive insurance: Collision damage insurance is a type of car insurance that pays for damage to your vehicle caused by a collision with another vehicle or object, even if you are at fault.
• Comprehensive coverage: Comprehensive insurance protects your money against damage to your vehicle that was not caused by an accident, but for example by theft, vandalism or severe weather.
• GAP insurance: If you lease or finance your car, difference insurance can be useful. In the event of a total loss, difference insurance helps cover the difference between the lost value of your car and the outstanding loan balance.
• Roadside assistance: Roadside assistance covers the cost of minor vehicle repairs and services such as towing (up to a certain distance), fuel delivery, battery replacement and flat tire replacement.
• Accident forgiveness: With Accident Forgiveness, your car insurance premium will not increase after your first at-fault accident. Keep in mind that most car insurance companies have damage limits that qualify for Accident Forgiveness, and some drivers may not qualify for the endorsement.
• New car replacement: With new car replacement insurance, you can get reimbursed for the cost of a vehicle of the same year and model if your existing vehicle is totaled.

frequently asked Questions

• What is the best car insurance in Arkansas?

  There is no one auto insurance company that is best for everyone. The company that offered your neighbor a great rate may not be able to do the same for you. That’s why most insurance experts recommend shopping around and comparing quotes when looking for the best insurance company in Arkansas. In addition to price, consider coverage types, discounts, and customer satisfaction when choosing the best auto insurance company for your needs.

• What is the cheapest car insurance in Arkansas?

  Based on sample price quotes, the cheapest auto insurance companies in Arkansas are USAA, Southern Farm Bureau, Geico and State Farm. You may also be able to lower your auto insurance premium by taking advantage of discounts, bundling your policies, paying your annual premium in full and improving your credit score. Comparing quotes can also help you figure out which company has the lowest rates for you.

• How much does car insurance cost in Arkansas?

  In Arkansas, the average cost of car insurance as of July 2024 is $2,156 per year or $179 per month for full coverage and $431 per year or $36 per month for a minimum coverage policy. However, keep in mind that car insurance premiums are personalized based on factors such as your zip code, age, credit score, and driving history. The cost of car insurance in Arkansas can vary widely depending on the driver.

• Do you need insurance to register a car in Arkansas?

  You will need proof of insurance when you register your car in Arkansas. You must be able to show that you have at least the minimum liability insurance required by law of 25/50/25. Remember that you have 30 days to register the car after purchase, but there is no grace period on insurance. To drive legally, you must have a valid policy.

• What affects car insurance premiums in Arkansas?

  Car insurance premiums in Arkansas are affected by several factors, including the driver’s age, driving record and credit history, as well as the type of vehicle insured and its safety features. Additionally, your location in Arkansas can impact premiums due to varying levels of traffic congestion and accident rates. The best way to learn how your specific premiums are calculated is to speak with your insurance agent.