Home Insurance in Arkansas


UPDATED: NOV 2020 | 3 MIN READ

Home is where the heart is. It’s also where your family, computers, furniture, bedding, food, and valuables are. With so much of our lives spent and stored within our homes, it only makes sense to want to protect our homes from being damaged or destroyed. This is where home insurance comes in. Though it’s undeniably an important purchase, the pricing and range of coverage you can get for home insurance can vary from state to state. In Arkansas, home insurance premiums are comparatively expensive for both renters and homeowners when compared with other states. And, though Arkansas may not be a gulf state buffeted by hurricanes or the most seismically active state, its location along a fault line and its history of heavy tropical storms and flooding mean that earthquake and flood insurance not offered by standard home insurance policies can be wise investments for homeowners. But what exactly makes for a good home insurance policy in Arkansas? To find this out, it’s good to compare the rates and coverage of many different companies to find the plan most suited for you. It’s also useful to learn some general information about home insurance in your region… we’re here to help!

  •  Fun fact: Ouachita National Forest, located in Arkansas, is the oldest national forest in the South.

Average Rates in Arkansas

According to the Insurance Information Institute’s latest report, Arkansas is the 13th most expensive state for homeowner’s insurance. Average premiums are $1,373, which is $162 more than the national average of $1,211. This places Arkansas among the more expensive states for home insurance, alongside Alabama (with premiums at $1,433) and Minnesota (with premiums at $1348).

Renter’s insurance is also expensive – its $212 premiums make Arkansas the 7th most expensive state in the nation and a full $92 above the national average. Some states with similar renter’s insurance premiums include Georgia, with $219 premiums, and Tennessee, with $199 premiums.

Arkansas Legal Insurance Requirements

As with most states, the Arkansas state government doesn’t require you to buy home insurance, nor are premium prices set by state legislation. However, if you want to take out a loan or mortgage for your home, there’s a high chance your lender will require you to get some type of home insurance. Below are listed some types of insurance that will commonly be on an Arkansas home insurance policy.

  • Coverage A: Damage to House. This will insure for damage to the main dwelling, assuming your house was damaged by a “peril” or damaging event covered by the policy. Some examples of perils that are covered are fires, windstorm damage, and vandalism, among others.
  • Coverage B: Other Structures. This offers coverage for the same kind of damage as Coverage A, but for auxiliary structures like garages and wood sheds.
  • Coverage C: Personal Property. This insurance covers for damage or theft of items inside your home, like furniture and personal belongings. If you are buying renter’s insurance, you only pay for this insurance and not for coverage on the outside structure of your apartment—that insurance is something your landlord pays for!
  • Coverage D: Additional Living Expense. You’ll have a specific limit that you can use to pay for living expenses such as hotel stays should you be unable to live in your home for a period due to damage from a peril the insurance policy covers.
  • Coverage E: Comprehensive Personal Liability. If someone has an accident on property that you own or rent, and you’re held responsible, then this coverage will help protect you from claims and lawsuits they may bring against you.
  • Coverage F: Medical Expense. This pays for medical bills should someone besides yourself, your family, or your housemates be injured while on your property and you’re held responsible. In Arkansas this coverage has limits that will cover only a certain amount per person, per accident.

Common Risk Factors in Arkansas

If you live in Arkansas, there are certain types of important insurance for your property that will not be covered by a standard home insurance plan. Because Arkansas lies along the New Madrid Fault, many homes may be at risk of suffering damage from earthquakes. In 2019 alone, Arkansas had 31 earthquakes of 5.0 magnitude or higher. Although no standard homeowners policy will cover earthquake damage, companies can offer an earthquake endorsement along with your policy for an additional premium. Depending on where your home is located, this endorsement is inexpensive, and can be a good investment.

Another common exclusion from Arkansas’ homeowners insurance is coverage for flood damage. You can, however, buy private flood insurance whether you’re inside or outside a floodplain, and whether or not your mortgage broker requires it. Some communities – particularly those in high risk areas – may also participate in the National Flood Insurance Program, through which you can purchase flood insurance policies.

Insurance Demographics/Statistics in Arkansas

When insurance companies set the price of insurance premiums, they consider not only the value of a home and personal possessions, but also some demographic information about the area around your address. If you live in a place where there’s a high level of property crime, for instance, insurers may increase prices to offset the higher risk of you making an insurance claim. It can be useful to consider the following information when looking for home insurance in Arkansas:

Your Home’s Value

There are two common ways of insuring your home: with replacement cost or actual cash value. Replacement cost is how much it would take to rebuild your home using similar materials. Most insurers require insuring for at least 80% of your home’s replacement cost, though they can insure up to 100%. Insuring for actual cash value means you’re insuring for the money it would take to repair your home from normal wear and tear. For both of these insurance types, looking at your home’s market value can give you a general idea of what your premiums may look like.

In Arkansas, the average value of a home is $130,907, which is significantly cheaper than the national average of $248,857. It’s a great state for affordable housing, which should translate into lower replacement costs!

Local Crime Rates

If your home is in an area with high rates of property crime, like theft and vandalism, it may affect the pricing and coverage your insurer will offer. The FBI Uniform Crime Reporting Program puts out state data on property crime rates – their most recent information states the average property crime rate in Arkansas when not including car theft is around 2.68%. This is quite a bit higher than the 1.97% national property crime rate, which may drive up home insurance prices.

Your Income and Education

Things like having good credit or a college degree can sometimes help lower your costs when paying for home insurance. But no matter the case, income always affects your ability to pay for home insurance and is something important to consider when budgeting for your ideal home insurance. The median household income in Arkansas was $47,062, which is below the national average of $63,179 by more than $16K.  

When it comes to educational attainment, Arkansas falls below the national average, with 22.6% of people above the age of 25 having earned a Bachelor’s degree, compared to the national 32.06%.

Where To Purchase Home Insurance in Arkansas

Only you can decide what the perfect home insurance policy for you looks like. Agilerates.com can offer you the chance to compare a comprehensive variety of options, giving you accurate quotes by quality insurers. Whether you’re just purchasing a home or you already have a policy that’s up for its annual renewal, you can find competitive offers from top insurance companies, or even find yourself some discounts based on improvements you may have made to your home over the past year. According to the Pulse Whitepaper from iii.org, only 44% of homeowners compare prices of different insurers at renewal time, and only 17% do so online. That means more than half of all homeowners are leaving money on the table at renewal time. Use agilerates.com online form to get matched with a local agent, get free quotes, and shop around!

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