Landlord Insurance Arkansas

Last updated: May 25, 2025

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"The first rule in investment is don't lose and the second rule in investment is don't forget the first rule." - Warren Buffett

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Landlord insurance in Arkansas is a specialized insurance package designed to protect rental property owners across the state. Whether you hold a single rental home in Little Rock or manage multiple investment properties throughout the Natural State, landlord insurance is an essential shield safeguarding your real estate assets and managing risks unique to Arkansas landlords.

Standard homeowners insurance often doesn’t cover rental properties adequately. It’s crucial to understand the key components of a robust landlord insurance policy in Arkansas and learn how to find affordable coverage tailored to this market.

Insurance premiums have been climbing nationwide, with increases exceeding 25% over the past 18 months, directly influencing your rental property’s profitability in Arkansas. Drawing from extensive experience reviewing landlord policies across Arkansas markets, we find that many landlords are overcharged by as much as 27% due to purchasing from agencies that lack specialization in landlord insurance.

Many Arkansas landlords unknowingly buy policies through general insurance agents unfamiliar with rental property nuances. These agencies may push higher-priced policies because their commission depends on your premium size. Even well-meaning agents often offer landlord insurance quotes tied to a limited carrier network or lacking Arkansas-specific expertise.

That’s why we built the OfferMarket Insurance rate shopping platform. Within 60 seconds, you can compare quotes from over 40 insurance companies offering Arkansas landlord insurance. Our specialized team vets every quote to ensure you receive comprehensive coverage at the lowest possible rate tailored to Arkansas property investors. Each month, we help Arkansas landlords save thousands — find out how much you can save!

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What Risks Does Landlord Insurance Cover in Arkansas?

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A comprehensive Arkansas landlord insurance policy typically includes:

🏠 Property insurance
⚖️ General liability insurance
💸 Business interruption insurance
🌊 Flood insurance (especially critical for Arkansas flood-prone areas)

Property Insurance

In Arkansas, the primary risk for landlords is damage to the property itself. This can result from storms common in the region, fire, or accidental damage. Your landlord insurance can also cover temporary lodging expenses for tenants if the property is rendered uninhabitable due to covered damage.

Arkansas landlords choose from three property insurance forms: Basic, Broad, and Special Form, each covering a different scope of risks called "perils."

Basic Form Perils in Arkansas

Basic property insurance covers fundamental risks such as:
🔥 Fire
🌩️ Lightning
💥 Internal explosion

Extended Coverage (EC) Perils in Arkansas

Arkansas landlords often add extended coverage using the mnemonic WCcSHAVVER, which includes:
🌬️ Windstorm (important given Arkansas’ exposure to severe winds)
🦹‍♂️ Civil commotion
🔥 Smoke damage
🌨️ Hail (hailstorms are common in Arkansas)
✈️ Aircraft damage
🚗 Vehicle impact
🌋 Volcanic action (rare in Arkansas but still listed)
💥 Explosion
❗ Riot

Plus vandalism and malicious mischief (V&MM):
🏚️ Vandalism
🦹‍♂️ Malicious mischief

Broad Form Perils

Arkansas landlord policies often include broad form perils, remembered by BIG AFFECT:
🥷 Burglary damage
🧊 Ice, sleet, snow (heavy winter weather can occur)
🪟 Glass breakage
🚰 Accidental water discharge
🧊 Freezing of pipes or appliances
✈️ Falling objects
⚡ Electrical current damage
🏚️ Collapse
💥 Tearing asunder

Special Form Peril (DP-3)

The most comprehensive landlord insurance, Special Form, covers all direct physical losses except those specifically excluded. In Arkansas, exclusions often include:

🌊 Flood damage (requires separate flood insurance)
🌎 Earthquake (rare in Arkansas, but endorsement available)
🤡 Intentional damage
⚠️ Building code enforcement issues
🔌 Off-premises power failure
🇺🇸 Government seizure

General Liability Insurance in Arkansas

Liability coverage protects Arkansas landlords if someone is injured or their property damaged on your rental premises. Most Arkansas landlord policies cover $100,000 to $1,000,000 per incident and $1,000,000 to $2,000,000 annually.

If a tenant slips on icy steps in Fayetteville or a contractor suffers injury during repairs in Fort Smith, your liability insurance will cover medical expenses and legal costs.

⚖️ Injury liability
🚑 Lawsuits

Business Interruption Insurance (Loss of Rent) in Arkansas

Arkansas landlords also face lost rental income if a covered event forces tenants to vacate, such as severe storm damage. Business interruption insurance compensates for this income loss, typically costing about $1 per $1,000 of annual rent. For example, on $40,000 annual rent, expect an extra $40 premium for this coverage.

Flood Insurance in Arkansas

Flood insurance is crucial in Arkansas due to frequent flooding in low-lying areas like along the Arkansas River and Mississippi Delta. If your property falls within a FEMA-designated Special Flood Hazard Area, flood insurance is typically mandatory. Lenders require flood certificates, and premiums vary by Arkansas flood risk zones.

We recommend carrying at least $250,000 in flood insurance, usually through the National Flood Insurance Program (NFIP). Flood coverage is separate from landlord insurance but vital to fully protect Arkansas rental properties.

Landlord Insurance for DSCR Loans in Arkansas

If financing Arkansas rental properties with DSCR loans, your insurance must meet lender standards. DSCR loan guidelines often mandate:

Insurance premiums impact your DSCR ratio, affecting loan eligibility and terms. For optimal Arkansas landlord loan financing, secure the most affordable, compliant landlord insurance policy.

How Much Does Landlord Insurance Cost in Arkansas?

Landlord insurance pricing in Arkansas depends on:

Location

Arkansas insurance carriers consider historical claims in your local market—urban areas like Little Rock or Fayetteville typically have different rates than rural counties. Arkansas’s varied climate and regional repair costs also influence premiums.

Property Insurance Type

Special Form is best for Arkansas landlords seeking broadest protection.

Dwelling Coverage Amount

The size of your dwelling coverage is the largest cost factor. Arkansas landlords should insure to full replacement cost to avoid coinsurance penalties.

Deductible

Higher deductibles lower your annual Arkansas landlord insurance premium.

Claim History

Arkansas landlords with frequent or severe claims on their properties or personal records face higher premiums. Insurers use CLUE reports specific to Arkansas addresses to assess risk.

Crime Score

In Arkansas, crime rates vary widely between urban centers and rural areas. Properties in neighborhoods with elevated crime scores (e.g., parts of Little Rock or Pine Bluff) may see higher premiums or coverage restrictions.

Property Condition

Arkansas rental properties in good repair, with modern electrical, plumbing, and HVAC systems, typically enjoy better premiums. Properties needing repairs or with hazards like lead paint may face higher costs or exclusions.

How to Protect Your Arkansas Rental Property

Beyond insurance, safeguard your Arkansas rental investment with these best practices:

Tenant Screening

Use credit checks and background screenings for Arkansas renters, with firm criteria to reduce risk.

Regular Maintenance

Inspect quarterly, especially after Arkansas storms. Watch for roof leaks, mold, and water intrusion, common in the state’s humid climate.

Tenant Maintenance Education

Educate tenants on basic upkeep, like winterizing pipes to prevent freeze damage during Arkansas cold snaps.

DP-3 Insurance

DP-3 policies are preferred in Arkansas for replacement cost coverage that best protects your investment.

What is Coinsurance?

Arkansas landlords should insure properties at least 80% of replacement cost to avoid costly penalties during claims.

Coinsurance Formula:
(Insurance Carried ÷ Insurance Required) × Loss – Deductible = Claim Payment

Example: If Arkansas property replacement cost is $200,000 but insured for $100,000 with $5,000 deductible and suffers $50,000 damage:
($100,000 ÷ $200,000) × $50,000 = $25,000 – $5,000 = $20,000 payout, leaving $30,000 out-of-pocket.

Arkansas Landlord Insurance Markets

We serve landlords throughout Arkansas including:
Landlord Insurance Little Rock
Landlord Insurance Fayetteville
Landlord Insurance Fort Smith
Landlord Insurance Jonesboro
Landlord Insurance Rogers
...and every other Arkansas community

Best Landlord Insurance in Arkansas

Choosing the right Arkansas landlord insurance depends on your risk tolerance, budget, and the depth of your coverage. A comprehensive policy includes property, liability, business interruption, and flood insurance if needed.

Partnering with an Arkansas-specialized insurance agency accessing many carriers ensures the best price and coverage. Start your Arkansas landlord insurance quote today with OfferMarket Insurance!

Landlord Insurance Guidelines for Arkansas DSCR Loans

Frequently Asked Questions About Arkansas Landlord Insurance

How does OfferMarket Insurance work in Arkansas?

OfferMarket Insurance is a specialized platform helping Arkansas real estate investors find landlord insurance tailored to their rental properties. We shop across 40+ carriers licensed in Arkansas to find you the best coverage at the lowest price, ensuring your policy meets both your preferences and Arkansas lender requirements.

Do I need a Builders Risk Policy for my Arkansas rental property

Builders Risk insurance is only necessary if you are renovating or building a property from the ground up in Arkansas. It’s not required for standard landlord insurance policies.

Can I choose Functional Replacement Cost instead of Replacement Cost Value in Arkansas?

This depends on your Arkansas lender’s guidelines. Many lenders allow Functional Replacement Cost, but some may require Replacement Cost Value, especially for older properties in Arkansas as indicated in appraisal reports.

Why does my Arkansas lender require to be an Additional Insured?

This is a common request for DSCR loans in Arkansas. Being named as an Additional Insured provides your lender with liability coverage on your policy, protecting their interests beyond the standard Mortgagee Clause.

Can I use my preferred Arkansas insurance agent for my landlord insurance?

Yes, as long as your agent can offer competitive landlord insurance policies that comply with Arkansas DSCR loan guidelines. Agents unfamiliar with landlord insurance or Arkansas-specific regulations may cause delays or higher costs.

Can I pay for my Arkansas landlord insurance at closing?

DSCR loan guidelines usually require that landlord insurance premiums be paid in full at closing, either through the settlement statement or directly to your Arkansas insurance agent before closing.

Is it possible to escrow my Arkansas landlord insurance premium?

Many Arkansas rental property lenders require premium escrow. This means your mortgage servicer collects the insurance payment monthly with your mortgage payment and forwards it to the insurance company.

Can I receive a refund if I cancel my Arkansas landlord insurance policy?

Yes, Arkansas insurance carriers must refund unearned premiums on a prorated basis. Make sure to have new coverage active before canceling to avoid any lapse in protection.

What is an AM Best Rating?

AM Best is a rating agency evaluating the financial strength of insurance companies operating in Arkansas. For landlord insurance, carriers should have an AM Best rating of A- VIII or higher to ensure reliability.

What is Builders Risk Insurance in Arkansas?

Builders Risk insurance covers your Arkansas rental property and materials during renovation or construction phases. Coverage typically includes fire, windstorm, vandalism, and theft specific to Arkansas construction risks.

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