Uninsured motorist coverage rules in Arkansas

If the driver who hit you had no insurance, carried too little, or left before you got a plate number, the policy that pays you is usually your own. Arkansas builds that protection through three separate coverages, and the rules for how you buy them and later collect on them are specific to this state.

Here's why it matters here. Arkansas requires only 25/50/25 in liability coverage: $25,000 for injury to one person, $50,000 per crash, and $25,000 for property damage ¹. That is the floor a lot of drivers carry, and it disappears fast against a serious hospital bill. Uninsured driving has fallen since Arkansas switched on a real-time insurance verification system in 2020. The Department of Finance and Administration reported the state's uninsured rate dropped from about 16% in early 2020 to 8.7% by October 2023 ². The national picture is worse: the Insurance Research Council found 15.4% of drivers uninsured and 33.4% either uninsured or underinsured in 2023 ³. An at-fault driver running out of coverage is not a rare event.

The three coverages your insurer has to offer

Arkansas law makes insurers put three things on the table for every private-passenger auto policy.

Uninsured motorist bodily injury coverage pays for your injuries when the at-fault driver has no liability insurance, and in most policies when a hit-and-run driver is never identified. Every policy issued in the state has to provide it unless the named insured rejects it in writing ⁴.

Uninsured motorist property damage coverage is a separate line that pays for damage to your vehicle caused by an uninsured driver. Arkansas handles it under its own statute ⁵.

Underinsured motorist coverage addresses the more common problem, where the other driver has insurance but not enough. Your insurer has to give you the chance to buy it, and again you can turn it down only in writing ⁶.

Two features of these offers trip people up. First, a rejection carries forward. Once you decline UM or UIM in writing, that rejection stays in effect through every renewal and replacement policy until you withdraw it in writing ⁴⁶. If someone signed a waiver years ago, the coverage is probably still missing today. Second, the amount is your choice, up to your own limits. Your insurer has to make UM available in limits up to your liability limits, and UM property damage up to your property damage liability limit ⁴⁵. Pull your declarations page and find the UM and UIM lines before you assume they are there.

What "underinsured" means in Arkansas

Two details about UIM decide whether you can collect, so get them right.

You cannot buy UIM without UM. Under Ark. Code Ann. § 23-89-209, underinsured coverage is not available unless you have elected uninsured coverage, and it must be issued in coordination with it ⁶. Drop UM and the UIM goes with it.

Arkansas measures "underinsured" against your damages, not against your own policy limit. The statute triggers UIM whenever the at-fault driver's liability limits are less than the amount of damages you incurred ⁶. Some states only let UIM apply when the other driver's limit falls below your UIM limit. Arkansas does not work that way. If your damages run past what the other driver's insurer pays, your UIM fills the gap up to your UIM limit, even if that driver carried the same 25/50 you do.

The property damage deductible quirk

Uninsured motorist property damage in Arkansas carries a $200 deductible, applied to losses above that amount ⁵. There is an exception worth knowing. If the same insurer carries both your collision coverage and your UM property damage coverage, and the at-fault driver is positively identified and solely responsible, that $200 deductible drops away ⁵. The coverage also cannot be forced above your own property damage liability limit ⁵.

This coverage pays to repair or replace the car. It does not, by itself, make you whole for the resale value a repaired vehicle loses. If your car was worth noticeably less after the wreck even once it was fixed, that is a separate diminished value question, and Arkansas has its own rules for it, covered in our Arkansas diminished value guide.

How fault and other coverages affect what you collect

UM and UIM pay what you are legally entitled to recover from the at-fault driver, so Arkansas fault rules follow the claim into your own policy. The state uses modified comparative fault with a 50% bar: if your share of the fault is equal to or greater than the other driver's, you recover nothing, and below that your recovery is reduced by your percentage ⁷. A UM or UIM adjuster can raise the same fault arguments the other driver's insurer would have.

Arkansas's first-party medical benefits sit alongside all of this. The state does not force you to carry them, but every auto policy has to offer at least $5,000 per person in medical, hospital, disability, and death benefits for expenses within 24 months of the crash, unless you reject it in writing ⁸. Those benefits pay your early bills regardless of fault and are separate from your UM/UIM limits.

The deadline that catches people

This is where Arkansas UM/UIM claims differ most from a standard injury case, and where people lose money.

A claim against the at-fault driver is a personal injury tort. You generally have three years from the crash to sue that driver ⁹. A claim for UM or UIM benefits is different: it is a claim against your own insurer under a contract, and Arkansas applies the five-year written-contract limitations period to it ¹⁰. In Shelter Mutual Insurance Co. v. Nash, the Arkansas Supreme Court held that a UIM cause of action does not even accrue on the date of the crash. It accrues when the insurer breaches the contract, usually when it denies the claim ¹¹.

That can be generous. It is also a trap. UIM is measured against what you could recover from the at-fault driver, so if you let the three-year deadline against that driver lapse, or settle with them without your UIM carrier's sign-off, you can wreck the underinsured claim you assumed you had five years to bring. Most policies also carry their own notice and consent-to-settle conditions on much shorter fuses. Tell your own insurer early, in writing, and get consent before you accept any settlement from the at-fault side.

What to do next

Start with your declarations page. Find the UM bodily injury, UM property damage, and UIM lines, confirm the limits, and check whether an old written rejection is still riding along on your renewals ⁴⁶. Report the crash to your own insurer promptly, even when the other driver was clearly at fault, because your UM/UIM coverage is now in play.

Document the claim the way you would any injury case, including the police crash report, which becomes core evidence on who was uninsured and who was at fault. You can get an Arkansas crash report here. If the numbers are serious, or your own insurer starts fighting on fault or value, an Arkansas attorney who handles UM/UIM claims can push for the coverage you paid for. Our legal directory is a place to start.

This is general information about Arkansas law, not legal advice.

Sources

1. Ark. Code Ann. § 27-22-104, Insurance required, minimum coverage. https://law.justia.com/codes/arkansas/title-27/subtitle-2/chapter-22/subchapter-1/section-27-22-104/

2. Route Fifty, reporting Arkansas Department of Finance and Administration data on the state's uninsured driver rate (Oct. 2023). https://www.route-fifty.com/management/2023/10/number-uninsured-drivers-one-state-plummets-new-verification-system-automatic-fines/391541/

3. Insurance Research Council, "One in Three Drivers are Either Uninsured or Underinsured in the U.S." (2023). https://insurance-research.org/news/one-three-drivers-are-either-uninsured-or-underinsured-us-exposing-themselves-and-other

4. Ark. Code Ann. § 23-89-403, Uninsured motorist coverage. https://law.justia.com/codes/arkansas/title-23/subtitle-3/chapter-89/subchapter-4/section-23-89-403/

5. Ark. Code Ann. § 23-89-404, Uninsured motorist property damage coverage. https://law.justia.com/codes/arkansas/title-23/subtitle-3/chapter-89/subchapter-4/section-23-89-404/

6. Ark. Code Ann. § 23-89-209, Underinsured motorist coverage. https://law.justia.com/codes/arkansas/title-23/subtitle-3/chapter-89/subchapter-2/section-23-89-209/

7. Ark. Code Ann. § 16-64-122, Comparative fault. https://law.justia.com/codes/arkansas/title-16/subtitle-5/chapter-64/section-16-64-122/

8. Ark. Code Ann. § 23-89-202, first-party medical, disability, and death benefits. https://law.justia.com/codes/arkansas/title-23/subtitle-3/chapter-89/subchapter-2/section-23-89-202/

9. Ark. Code Ann. § 16-56-105, three-year limitation on tort actions. https://law.justia.com/codes/arkansas/title-16/subtitle-5/chapter-56/subchapter-1/section-16-56-105/

10. Ark. Code Ann. § 16-56-111, five-year limitation on actions on written contracts. https://law.justia.com/codes/arkansas/title-16/subtitle-5/chapter-56/subchapter-1/section-16-56-111/

11. Shelter Mut. Ins. Co. v. Nash, 357 Ark. 581, 184 S.W.3d 425 (2004). https://www.courtlistener.com/opinion/1465882/shelter-mutual-insurance-v-nash/