Arkansas home insurance
Compare, shop and customize quotes from top-rated insurance carriers.
Arkansas home insurance buyer's guide
Just over 3 million people live in the state of Arkansas (AR). More than 66% of the state's residents live in owner-occupied housing. At an average value of about $142,000, a home is the most valuable possession of most residents of the state. Storms, fires, crime and other risks can create economic havoc for homeowners. Arkansas homeowners insurance provides financial protection from these risks.
Arkansas home ownership risks
Arkansas is a largely rural state. Over 84% of the fire departments in Arkansas are volunteer fire departments, compared to the national average of just over 70%. Volunteer fire departments tend to have fewer resources and be farther away from homeowners, which can increase the likelihood of severe fire damage to homes.
Access to fire protection can also impact the fatality risk from house fires. There were 35 reported home fire fatalities in Arkansas in 2022.
Dry weather conditions and other hazards can lead to wildfires that burn thousands of acres and put homes at risk. There were over 500 wildfires that burned more than 7,600 acres in 2019.
Wind damage is another substantial problem for Arkansas homeowners. Residents of the state experience about 37 tornadoes every year. Additionally, straight-line winds from thunderstorms can reach up to 80 to 90 miles per hour, causing damage to roofs, siding and other structures.
Hail can also cause damage to homes in the state. Hail that is baseball-sized or larger occurs in Arkansas about once per year, and softball-sized hail happens about once every other year. Hail between two and four inches in diameter is a more common occurrence.
Arkansas home insurance coverages
A homeowners insurance policy is a package of coverages that protect your family from financial losses related to your home and belongings. Arkansas law does not require homeowners to purchase insurance coverage. However, if you have a mortgage on your home, your lender may require you to purchase this insurance.
Homeowners insurance policies usually cover:
• Your home.
• Other structures on your property.
• Your personal property.
• Your liability for injuries to guests or damage to their property.
Many insurance companies offer additional coverages that expand your protection beyond the standard homeowners policy. Additionally, you can purchase specialty policies for mobile homes or older homes.
Open Perils
The broadest form of homeowners insurance provides coverage for all causes of loss that are not specifically excluded by the policy. Some typically covered perils include:
• Fire.
• Explosion.
• Wind.
• Lightning.
• Hail.
Most policies only cover water damage from a sudden and accidental discharge, such as a burst pipe. This means that standard policies typically do not cover damage from weather-related flooding.
Named Perils
A Named Perils policy only covers the causes of loss specifically listed in the policy. This type of coverage is usually less expensive than traditional homeowners insurance because it protects against fewer potential causes of loss.
Replacement Cost versus Actual Cash Value
Homeowners insurance policies can be issued as Replacement Value or Actual Cash Value policies. Replacement Value policies pay the cost to replace or repair your damaged property at current market rates.
Actual Cash Value policies pay to replace or repair your property at actual cash value, which is the replacement cost, minus depreciation. Actual Cash Value policies cost less money but also pay out less when you have a claim, which may result in your insurance claim not being large enough to cover all of your expenses.
Flood Insurance
While some areas, such as property located near rivers and streams, are more likely to flood than others, a flood can happen anywhere. Because most homeowners policies exclude flood coverage, if you want protection from flood damage, you may need to purchase a policy through an insurance provider or the National Flood Insurance Program.
Earthquake Insurance
Most homeowners policies exclude coverage for earthquakes. The Arkansas Earthquake Authority Act of 1999 established a Market Assistance Program to help people purchase earthquake coverage when they cannot obtain it on the standard market.
Average cost of Arkansas homeowners insurance
The average annual Arkansas homeowners insurance cost is $1,550 per year, which is 12% higher than the national average. This makes Arkansas among the 15th most expensive state in the United States for homeowners insurance.
The insurance company you choose affects how much you pay for home insurance. Find the best rate on the coverage you need by comparing quotes from different companies with VIU by HUB.
Factors that affect Arkansas home insurance rates
The value of your home is the factor that most impacts the cost of your home insurance. The more your home is worth, the higher your rates will tend to be. But several other factors can affect your rates as well.
Location
Different cities have varying risk factors, such as higher crime rates or more frequent natural disasters, which can impact insurance rates. Larger cities with higher crime rates and average home prices, such as Maumelle, tend to have higher rates, while smaller towns, such as Wynne, usually have lower average costs. However, some rural areas have higher prices due to limited fire protection.
Credit
Arkansas insurance companies may use your credit information as part of their pricing decision. People with poorer credit tend to pay higher premiums.
Public Protection Classification (PPC) Program
The Insurance Services Office assigns all locations in the state a public protection classification between one and 10 based on the manpower, equipment, water source and other factors impacting the local fire district. One is the best rating, and 10 indicates a rural area that has minimal fire protection.
The higher your PPC rating is, the higher your rates will tend to be because homes in areas with better fire protection have a lower risk of severe fire damage. You can find out what your protection class rating is by contacting your local fire department.
This information is intended for general informational purposes only and is not intended to constitute legal advice.