Arkansas Homeowners Insurance


Residents in Arkansas pay an average of $109 per month or $1,312 per year in home insurance premiums. 

There are over 1 million housing units in the state, sixty-six percent of which are owner-occupied.

The average monthly costs for a homeowner with a mortgage in Arkansas is $1,021.

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Arkansas Statistics

3,004,279

Population

$114,700

Average value of owner-occupied housing units

1,141,480

Households

$42,336

Average household income

85%

Highschool grad or higher. percent of people age 25 years +

22

Average travel time to work

(minutes)


If you are shopping for homeowners insurance in the state of Arkansas, you've landed on the right page. This article will help you make right consumer decisions when picking your insurer and coverage for your home. Due to its location in the Deep South, Arkansas is prone to certain natural hazards that affect premium rates. Flooding is a common issue in Arkansas, and flood insurance is not offered as a standard coverage. As a resident in this state, you will need to obtain flood insurance through the National Flood Insurance Program to get financial coverage in the event of loss due to flooding.


Arkansas receives approximately 20 tornadoes each year, and has been hit by some of the most destructive tornadoes in history. You may receive insurance discounts for taking precautions against wind and hail damage, such as fortifying your roof or having tie-downs and ground anchors for your mobile home. 

Arkansas residents are presented with a lot of natural hazards due to its close location to the gulf of Mexico. The region experiences hurricanes that cause a lot of damage. Therefore the average state premiums are slightly higher than the average premiums nationwide. Regardless of the location of where you choose to live, home insurance is always available to every homeowner. Having a home insurance policy comes with lots of benefits. 


A good home insurance policy gives you peace of mind as it protects your home in the event of loss. Furthermore, you can obtain coverage for your specific needs at a minimum cost. Compared to other types of insurance policies, home insurance is known to have one of the lowest premiums. Keep reading or enter your Zip below to start comparing insurers near you.


Arkansas home insurance overview


Arkansas hosts around one million housing units. Approximately 66 percent of homes in Arkansas are occupied by the homeowner, which is greater than the national average of 63 percent. In this state, 24 percent of homeowners spend 30 percent or more of their annual income on costs associated with homeownership. 


By Arkansas law, you are not mandated to carry insurance for your house unless you are fiscally tied to a bank loan. Arkansas is located in the seismic zone of New Madrid, therefore earthquakes can be experienced here. If the insurance company is not covering earthquake as others do, then they should advice you further using Market Assistance Program (MAP). MAP was created from the Arkansas Earthquake Authority Act in 1999. The program was created for AL residents whose not able to get earthquake insurance through available insurers.

Consider all options.

Find the best homeowners insurance companies near you.

Arkansas and nationwide home insurance premiums


The National Association of Insurance conducted a study in January 2018 and came up with home insurance expenditure figures. According to the study, premiums went up by 3.6% in 2015 a figure higher than 3.3% in 2014. In 2015 Florida had the highest average premium at $1,993 while Oregon had the lowest at $643. On the other hand, the average home insurance premium nationally was at $ 1,173. The same study ranked Arkansas as the 14th state to have the most expensive premiums throughout the US, with an annual average of $1,312.


AR residents pay an average of $109 per month on home insurance, $11 more than the national average. It's useful to look at averages to gauge what's fair in the market. Keep in mind that rates vary greatly depending on location and provider so it's worth it to compare quotes from as many companies as you can to save money. 

Average Arkansas Home Insurance Premiums

 20142015
Monthly average$104$109
Annual Average$1,252$1,312
National annual average$1,132$1,173
Rank1314
Source: Insurance Information Institute

Top 3 home insurance companies in Arkansas


Most home insurance consumers go for a rated insurance company. A rated company is an insurance company that's deemed high regarding its credit worthiness. A good company is one that can: pay claims and be able to perform financially. We decided to dive deeper into the top 3 companies that hold the most market share in the state, to see if ratings and consumer satisfaction align with how popular they are.


State Farm


Many homeowners across the US choose State Farm as their home insurance provider above all other companies. State Farm has held a high reputation in the industry for many years. J.D Power rated State Farm with 4 (Better than most) power circles for consumer satisfaction. By assessing a company's consumer satisfaction rating, we can get a sense of how the payouts are being handled. State Farm puts consumers first by offering competitive rates in AR. In case you experience a loss, you could file a claim in person, online, through a phone call that is available 24/7 or by using their mobile App. Since online shopping is the new norm, it's important for an insurance company to have a website that's able to provide the support and information needed for the consumer to be able to make the best choice for his/her individual situation.


According to Insurance Information Institute, State Farm has the largest claims network in the country. Property damage (theft included) made up 97 percent of home insurance claims in the US. In 2016, only 5.3 percent of insured homes filed a claim. As of 2017, State Farm has written direct homeowners insurance premiums of $238,139,000 in Arkansas. The company holds the largest market share of 26.2% in Arkansas. It has one of the cheapest insurance policies in Arkansas and offer discounts if you insure car and home with them.


Farm Bureau Mutual


Originating from Iowa in 1939, Farm Bureau started off serving farmers with liability insurance. The company has grown since then now providing car insurance, home insurance and life insurance . Arkansas is one of 19 states with its own Farm Bureau insurance companies that sell coverage only in their state. 


The Farm Bureau Mutual has a market share of 14.8% coming second in Arkansas. Their direct premiums for Arkansas home insurance stand at $133,913,000. A.M Best upgraded their rating for this company to an A- (Excellent) from B++ (Good). AM Best's rating process puts into play a company's business profile, balance sheet, financial performance and management style. 


It is not easy to rank the Farm Bureau Insurance compared to other companies in the region due its members only policy. You have to be a member of County Farm Bureau Agricultural Organization for you to be insured with them. 


Shelter


JD Power gave Shelter a rating of 4 (Better than most) for overall consumer satisfaction. Shelter received one of the highest scores of 5 (Among the best) in the claims experience category beating out a lot of companies. As of 2017, the direct premiums were at $ 76,753,000 and had a market share of 8.5% in AR. 


Shelter provides its policyholders sensible catastrophe exposure management by creating voluntary pre-event catastrophe reserves. These reserves are meant to combat large natural disasters by providing self-insured shelter. This extra effort by Shelter reflects A.M. Best's stable A (Excellent) rating. Another worthy mention is the Shelter Foundation Scholarship where each year, agents and the Shelter Foundation award students, who are from local communities where they operate, with scholarships. In 2017, a total of $878,000 scholarships to 439 students were given out. Each year, the total amount given away grows due to more agents giving back each year.


Shelter has a high rating and a big online presence. Reason being that it has a very informative website about its coverage and options consumers can choose from. Shelter offers basic discounts: discounts for safety addition, multi-policy discounts and claims free discounts. However, after filing the online quote tool, you will have to wait for an agent to reach out to you. One of the downsides to the company's website is that it does not readily give out premium estimates, a convenient tool for homeowners shopping for insurance.

Arkansas home insurance companies: Market share and summary of ratings

RankCompanyMarket Share %AM BestS&PJ.D. Power 
1State Farm26.2A++AA3
2Farm Bureau Mutual14.8A-NR3
3Shelter Insurance8.5ANR4
4Allstate Corp.8.1A+AA3
5Farmers6.9AA3
6USAA5.5A++AA+5
7Liberty4.8AA3
8Nationwide3.1A+A+3
9Auto-Owners2.2A++AA4
10United Home1.7A-NRNR

NR: Not rated
Source: Insurance Information Institute

Economic boost


The insurance industry in Arkansas has a significant contribution to its economy. Not only does it collect premiums and compensate the insured, but also contributes to about 1.73 percent of the states GDP. Insurance companies owns a number of municipal bonds, contributes to taxes and also employs professionals improving peoples lives.


Five tips to help you get the cheapest rates


Do you too have your house in Arkansas? It could be that you have just bought a new house there and are soon to move in. Before you move in, you must sign up for adequate homeowners insurance to keep your home guarded in times of theft and damage. On average, Arkansas homeowners pay a premium rate of $1,252 for home insurance. This amount exceeds the national average of $1,132 for homeowner insurance premiums, and makes Arkansas the 13th most expensive state for homeowner and renter premiums. As mentioned above, higher than average home insurance costs are caused by high risks due to natural hazards such as flooding. Thus, it’s natural that a smart homeowner will always look for ways to cut down on the homeowners insurance costs. And the post below offers 5 top tips that will help you to save on your insurance premium.


1. Raise deductible


The first tip here is to up your policy deductible. The word “deductible” here refers to the sum of money a policyholder has to pay for a loss prior to his insurance company starts paying for his claim. Higher deductible always assures less payment for premiums. Your insurance company in Arkansas will mostly ask for minimum $500 for deductible. But if you are able to afford up to $1,000, you will save something like 25 % on your premium. And, that’s quite a cool deal.


2. Secure home against disasters


This point is especially crucial when we are talking about saving on homeowners insurance policy in Arkansas. The State receives around 20 tornadoes per year and this is one of the main reasons behind high insurance rates here. But, if you can safeguard your home against hail and wind damage, you will receive excellent discounts on your homeowners insurance premium. The bottom-line is- you have to make your insurer feel that your house is protected and there is less chance of claims.


3. Secure home against accidents, theft & vandalism


Do you know your insurer will reward you with 5% percent discount if you equip your home with burglar alarm, smoke detector & deadbolt locks? You may qualify for an even greater 15-20% discount if you upgrade your home with an advanced sprinkler device and burglar/fire alarm that make automatic calls to cops, fire as well as other major monitoring stations. However, you should also ask your insurer for recommendations before installing such systems. All insurance companies don’t offer similar range of discounts for the systems mentioned above. So, do your homework.



4. Boost credit score


Bad credit score affects your homeowners insurance rates big time. In Arkansas, the average insurance premium fluctuation is 62% based on the policyholder’s credit score. If you can excellent credit record, you will be able to save around 20-40% or even more on insurance premium, depending on your insurance company.


5. Bundle your insurance


Most of the insurance companies will offer you 5-15 percent discount when you buy multiple insurance policies from them. So, you can bundle up your auto insurance with homeowners insurance with the same insurer to enjoy handy discounts.


Finally, most of the insurance companies in Arkansas treasure long-term customers. They are ready to offer something around 5% rebate for loyal customers. Individuals aged 60 and older can save up to 10 percent on their premium insurance costs. Your premium rates can also be lowered if your home has been recently renovated, and if it has safety devices such as fire extinguishers, smoke detectors, deadbolt locks, and theft prevention systems.


Bottom line


Regardless of where you live, your Arkansas home insurance policy will cover certain categories. All residents receive coverage for their primary dwelling, which protects the physical structure of your home, including the roof and walls, against damage due to loss. You will also get personal property protection, which insures certain belongings such as furniture, bicycles, and electronic equipment not used for business purposes. 


Additionally, all insurance policies provide liability protection, which protects you in the event that someone is injured on your property and in turn makes a claim or brings a lawsuit against you for damages. Arkansas homeowners insurance also includes medical protection, which protects you and your guests for the costs of medical expenses incurred from injury on your property.


Unlike many other states, however, Arkansas law does not require coverage for additional structures on your property that are not the primary residence. That means you may have to get separate add-on coverage for a detached garage, tool shed, art studio, etc. You should also ask about additional protection, which is an add-on service that reimburses you for costs attributed to food and lodging expenses due to a forced relocation if your home becomes uninhabitable for a period of time after a covered loss.


Home insurance rates are a bit high in Arkansas due to a high catastrophic events that frequent the place. The storms experienced every year means big payouts from the insurance companies. It is therefore important to think ahead and cover your home, before you do that, ask the company if they require endorsements for specific coverage of catastrophic events.

Consider all options.

Find the best homeowners insurance companies near you.

Ark​​​​ansas Insurance Department

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